Change Managmnt

The Digital Step
A Master Thesis
Change Management or continuous

improvements
Planning a company to transform into a Lean Enterprise.
e-MBA
at
University of Gävle
2005 - 2006
by
Jerry Hurum
MBA Thesis Jerry Hurum
The Digital Step HIG 2005
Summary
It seems commonly accepted that today’s competitive environment with changing customer
values, the need to introduce products faster, and financial expectations of stockholders
demand a change in the old way of doing things.
In 2003 Dyno Nobel merged with an American company, Ensign Bickford, which had
developed very promising results over the last few years. The Ensign Bickford Company had
recently received the Szhingo Prize for their excellent implementation of Lean Production
(Toyota Production System). It was now decided to implement “Lean” in all of the new Dyno
Nobel.
LEAN is about creating more value for customers by eliminating activities that are considered
waste. This implies that any activity that consumes resources, adds cost or time without
creating customer value is a target for elimination.
It’s often said that Lean is more a philosophy than it is a system. We need to change the way
we think. It’s to continuously improve the way we operate. An endless fight against waste.
The problem here is how to transform the European, Middle East and African part of Dyno
Nobel into becoming a “Lean Enterprise”. The objective of this thesis is to develop a change
plan (method or model), which can be used as a basis when managing the Lean
implementation in this part of Dyno Nobel (in all practical respects we’re actually talking
about the Scandinavian part of the company).
From all available literature, input from other sources as well as advices given by other
professionals a transformation or implementation plan has been created. Then some of the
theories from the plan have been tested in real life at some pilot areas of the organisation.
In this study, besides the theories and philosophies around Lean and the Toyota production
system itself, the core of the Plan developed has been created around the methodology as
outlined by J.P. Kotter in his book "Leading Change" and by the systematic approach to a
problem as described by Dr. W. Edwards Deming and the continuous improvement spiral, the
PDCA wheel. Dr. Deming's approach is actually said to be the catalyst for the development of
the Toyota production system in the first place. The hole spirit of Lean circles around
continuous improvements, never to relax and be satisfied, to always strive for improvements
and to do so by the “Plan – Do – Check – Act” approach described by Dr. Deming.
The cases studies here can all be seen as preliminary studies in implementing different parts
of the Lean Philosophy in practise. Through Value Stream Mapping of all the major value
streams at the company, the cases to study, or rather the cases to start with, where selected.
Based on the results and experience gained from those pilot areas the plan have been
evaluated and or adjusted. The strategy chosen here was to conduct a survey in literature and
mixed also with input from visiting other companies that have conducted similar changes and
then create a first version of the Plan. To improve the Plan and to verify the methods some
in-house case studies have been conducted.
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A qualitative research approach has been utilised for this study. A qualitative approach has
been used, researching the implications of transforming an organisation to become Lean, in
other words to make individuals change behaviour in their interaction with others.
The essential idea here is that the researcher goes "into the field" to observe the phenomenon
in its natural state or in situ. As such, it is probably most related to the method of participant
observations.
Based on the experiences gained from the cases run, combined with the input from literature,
the outcome of this study is a plan for how to manage the transformation of a specific
company to become a Lean Enterprise that might also be of interest to others considering
similar changes in other companies. Even though, as outlined by the author, an organisation’s
culture is unique and the world of commerce is constantly changing, as the circumstances of
today may not be relevant in a week or few months time. As a consequence, this plan should
not be considered to generally valid for other companies.
In short, the conclusion is that change is possible. You need a simple understandable plan, the
company top management to lead the way and constant focus.
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Table of Contents
1 Introduction........................................................................................................................ 6
1.1 BACKGROUND ............................................................................................................. 6
1.1.1 The problem........................................................................................................ 7
1.2 OBJECTIVE .................................................................................................................. 7
1.3 PURPOSE...................................................................................................................... 7
1.4 SCOPE AND RESULTS ................................................................................................... 7
1.4.1 Scope .................................................................................................................. 7
1.4.2 Exclusions........................................................................................................... 8
1.4.3 Results and Deliverables .................................................................................... 8
1.4.4 Target group....................................................................................................... 8
1.5 HISTORY OF DYNO NOBEL .......................................................................................... 8
1.6 CHANGING THE COMPANY ........................................................................................... 9
2 Method ............................................................................................................................. 11
2.1 QUALITATIVE VS . QUANTITATIVE METHODS ............................................................. 13
2.2 RESEARCH PURPOSE.................................................................................................. 14
2.3 RESEARCH APPROACH .............................................................................................. 14
2.4 RESEARCH STRATEGY ............................................................................................... 15
2.5 LITERATURE AND HISTORICAL STUDY ...................................................................... 16
2.6 CASE STUDIES ........................................................................................................... 17
2.6.1 Data Collection ................................................................................................ 18
2.6.2 Sample Selection .............................................................................................. 19
2.6.3 Data Analysis ................................................................................................... 20
2.7 VALIDITY AND RELIABILITY ..................................................................................... 21
2.7.1 Validity ............................................................................................................. 21
2.7.2 Construct Validity ............................................................................................ 21
2.7.3 Reliability ......................................................................................................... 22
3 Theoretical frame of reference ......................................................................................... 23
3.1 THE LEAN PHILOSOPHY ............................................................................................ 24
3.1.1 Lean, or the Toyota Production System ........................................................... 25
3.1.2 Lean (Kaizen) Tools ......................................................................................... 26
3.1.3 So, what do we have to change? ...................................................................... 27
3.2 CREATING A STRATEGY ............................................................................................ 29
3.2.1 Vision................................................................................................................ 32
3.2.2 Business Idea (Mission) ................................................................................... 32
3.2.3 Critical Success Factors (CSFs) ...................................................................... 32
3.2.4 Values ............................................................................................................... 32
3.2.5 Planning for change ......................................................................................... 33
4 The Plan............................................................................................................................ 36
4.1.1 Establishing a Sense of Urgency...................................................................... 36
4.1.2 Creating The Guiding Coalition ...................................................................... 37
4.1.3 Developing Vision And Strategy ...................................................................... 37
4.1.4 Communicating The Change Vision................................................................. 38
4.1.5 Empowering Employees for Broad Based Action ............................................ 42
4.1.6 Generating Short Term Wins............................................................................ 44
4.1.7 Consolidating Change and Producing More Change...................................... 45
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4.1.8 Anchoring New Approaches in the Culture...................................................... 45
4.2 CHANGE LEADERSHIP SUMMARY.............................................................................. 45
5 Creating the Change ......................................................................................................... 46
5.1 PEOPLE'S EXPECTATIONS AND PERCEPTIONS ............................................................. 46
5.2 SOURCES OF RESISTANCE .......................................................................................... 46
5.3 DEALING WITH RESISTANCE ...................................................................................... 47
5.4 CURRENT REALITY AND PRECONDITIONS .................................................................. 50
5.5 STEPS IN MANAGING THE TRANSITION ...................................................................... 50
6 Empirics ........................................................................................................................... 50
6.1 CASE STUDIES ........................................................................................................... 51
6.1.1 5S at the Gyttorp IS Plant ................................................................................ 51
6.1.2 Standard Work Event in H-2100 ...................................................................... 62
6.1.3 Mistake proofing Kaizen .................................................................................. 68
6.1.4 Lean in administrative processes ..................................................................... 72
7 Discussion and Analysis ................................................................................................... 76
8 Conclusions ...................................................................................................................... 80
9 Recommendations ............................................................................................................ 82
10 Appendix 1 ................................................................................................................... 83
11 References .................................................................................................................... 86
I want to express a special thank you to Jim Bayliss (a former employee of Dyno Nobel). He
has been my role model and to some extent my mentor as I’ve managed the implementation
of Lean in the Scandinavian part of Dyno Nobel. In the development of the Plan he has also
been a valuable help and inspiration.
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1 Introduction
It seems commonly accepted that today’s competitive environment with changing customer
values, the need to introduce products faster, and financial expectations of our stockholders
demand a change in the old way of doing things.
Members of any organization have stories to tell of the introduction of new programs,
techniques, systems, or even, in current terminology, paradigms. Usually the employee, who
can be anywhere from the line worker to the executive level, describes such an incident with a
combination of cynicism and disappointment: some manager went to a conference or in some
other way got a "great idea" (or did it based on threat or desperation such as an urgent need to
cut costs) and came back to work to enthusiastically present it, usually mandating its
implementation. The "program" probably raised people's expectations that this time things
would improve, that management would listen to their ideas. Such a program usually is
introduced with fanfare, plans are made, and things slowly return to normal. The manager
blames unresponsive employees, line workers blame executives interested only in looking
good, and all complain about the resistant middle managers. Unfortunately, the program itself
is usually seen as worthless: "we tried team building (or organization development or quality
circles or what have you) and it didn't work.
Planned change processes often work, if conceptualised and implemented properly; but,
unfortunately, every organization is different, and the processes are often adopted "off the
shelf" "the 'appliance model of organizational change': buy a complete program, like a 'quality
circle package,' from a dealer, plug it in, and hope that it runs by itself1 "
The perspective in this paper will be from the middle management point of view. Even though
the top management feel the pressure of demanding owners, and the employees in the other
end of line, the operators and other staff at the shop floor so to speak, feel the pressure of
instantly increasing work load and reduced resources, it seems to me the need for change
often occurs in the middle management where customer contact and financial planning is
normally handled.
So, as a middle manager, how do you go about if you want to change the company where you
work? In this paper it’s the change of a company to become “lean” that’s the issue.
1.1 Background
This study is based on my personal limited experience with change management. I work in a
relatively small, still global and dominating company in its field, Dyno Nobel. In the autumn
of 2005 it had approx. 4000 employees located in 36 countries. It is world leading in its field,
commercial explosives, with approx. 20 % world wide market share.
Since august 2003 I’ve been managing the Lean implementation at Dyno Nobel Sweden AB,
a 400 employee marketing and manufacturing site in Nora, Sweden. The manufacturing plant
had been looking into some of the tools of Toyota Production Systems since the early 90’s
and a more thorough implementation of Lean Production principles went relatively well.
Production increased, quality improved and costs and lead-time went down. At the spring of
1
Kanter, R. (1983). The Change Masters. New York: Simon & Schuster, p. 249
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2005 I was asked to lead the transformation of the whole European, African and Middle East
Business Units (EMEA) transformation towards becoming a Lean Enterprise. For this work a
plan or model to follow is needed.
1.1.1 The problem

The problem here is how to transform the European, Middle East and African part of Dyno
Nobel, or in all practical respects the Scandinavian part of the company, into becoming a
“Lean Enterprise”. What is needed is a convincing plan or strategy for the transformation that
is convincing both towards our owners as well as our employees.
The empirics referred to in this MBA thesis will be from the company where I’m employed,
Dyno Nobel. The cases referred to will not be analysed in detail, still as they form the basis of
my limited experience from this kind of work I will describe them and refer to them as I look
into theories and methods from literature. I will seek to find a best practice or perhaps even
new improved electronics tools to help improve on productivity or at least help reduce costs
without a reduction in the quality.
The working environment is rather complex with both small on-man sites, some even without
online computers, as well as larger factories with special video meeting rooms.
In this thesis I will not only look into the different technical solutions but also different
management stiles and theories. My assumption is that we need to combine the use of new
technology with appropriate management techniques to be successful in this attempt to
manage change. The reasons for why some change programs turn out successful and why
some don’t will be analysed and linked to some well-known theories.
1.2 Objective
To develop a change plan (method or model), which can be used in managing Lean
implementation in Dyno Nobel.
1.3 Purpose
To help the company improving on efficiency and/or productivity by continuous
improvements, i.e. becoming a lean enterprise.
1.4 Scope and results

1.4.1 Scope
From literature studies, including the Internet and by interviews of managers dealing with this
kind of challenges and from personal experience, to find and describe a plan or method for
implementing Lean principles and philosophy in a company from middle managers stand
point. I’m looking for best practice.
When we’re talking about change we’re talking about improving on a business process of
some kind. The tricky part being that a business process affects people’s behaviour. To
change a process we often need people to change behaviour.
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1.4.2 Exclusions
It is not within the scope of this Thesis to implement any new tools; neither will it be to
perform any training of employees nor any coaching of managers. Neither is it to present a
detailed implementation plan, the plan presented are to be of a more general character or to be
seen as a platform for more detailed change programs.
The study will focus on issues and solutions related to change management in Dyno Nobel
and this is a plan for this particular company limited to Scandinavia as geographical
boundary.
1.4.3 Results and Deliverables

The outcome of this work shall be a plan or model that can form a theoretical and practical
basis when implementing the principles of Lean in the Scandinavian part of Dyno Nobel.
Also some events or cases of actual change will be performed. All presented as a report in the
form of a MBA thesis.
1.4.4 Target group

Beside myself, I hope that other “Change Managers” can find some help in this document.
With “Change Manager” I’m here referring to other mangers in similar situation as myself,
e.g. managers responsible for implementing changes without being part of top management in
the company.
1.5 History of Dyno Nobel

Dyno Nobel traces its roots back to William Bickford's invention of Safety Fuse in 1831 and
Alfred Nobel in 1865. Over 170 years later, Dyno Nobel has become the world’s leading
Explosives Company and a truly global supplier of commercial explosives solutions.
Every major explosives innovation has been developed by Dyno Nobel, starting with the
invention of Safety Fuse in 1831, to the development of Slurry Explosives in 1956 and the
NONEL Initiation System in 1973.
During the 1860’s, Alfred Nobel experimented with the packaging of nitro-glycerine as a safe
explosive. Within a few years, he had developed and patented dynamite, and established his
first company, Nitro-glycerine Compagniet, in Norway. Alfred Nobel’s first company, Nitro
Nobel, became part of Dyno Nobel in 1986. It was this company, founded on a strong
philosophy of safety and practical innovation, that later became Dyno Nobel.
The company history actually began over two hundred years ago, when the first safety fuse
was invented by William Bickford, saving the lives of countless coal miners working the hills
of northern England. Bickford-Smith & Company, in Cornwall, England, brought the
operation to America in 1836, and the safety fuse manufacturing facility in Simsbury,
Connecticut would officially become The Ensign-Bickford Company.
In 2003 The Ensign-Bickford Company merged with Dyno Nobel ASA, with the new entity
to be called Dyno Nobel.
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Industri Kapital acquired Dyno ASA (formerly Dyno Industrier ASA) in December 1999, de-
listing it from the Norwegian Stock Exchange. The acquisition was completed in August 2000
and the newly privatised company renamed Dyno Nobel ASA.
Industri Kapital ( Industri Kapital ) is one of Europe's leading equity firms, renowned for its
strong business analysis skills and financial base. IK's ambition has been to work with
management to expand the explosives operations both organically and through acquisitions
with the objective of securing Dyno’s position as the world’s leading commercial explosives
manufacturer.
The commercial explosives market is best described as mature. There is over-capacity around
the world with a lot of small local producers. This is partly due to the troublesome
transportation of explosives in earlier days when most of those were nitro-glycerine based, as
dynamites. In a lot of nations explosives manufacturing were also seen as of national
importance and therefore many of the works were state owned or controlled.
In today’s market there are two major players, Dyno Nobel and Orica with approx. 20% of the
world market share each. Then there are a few companies dominating their local regions with
some 5 – 10 % of the market share each. The rest is very small local companies.
For the last 20 years Dyno and Orica have grown by acquiring a number of smaller
companies. Organic growth has been very limited with a possible exception for China and
CIS.
The customers are both small local entrepreneurs as well as large global mining corporations.
Needless to say they have different needs. For the local entrepreneur service and technical
assistance is very important while the global mining corporation wants a total supplier that
can be present everywhere in the world with ability to solve demanding logistic challenges.
Manufacturing and supply of commercial explosives is a mature business with two major
players with more or less equal values (safety first, etc.). Both companies grow mainly
through acquisitions with a limited organic growth in the newly opened markets in China and
CIS.
Very often those two companies are fighting for the same customers and contracts. In this
context pricing, service, and having the best technical solutions become important.
Both companies have spent decades on securing storages with smarter logistic solutions,
including developing explosives solutions as mobile plants (to allow for transportation of non-
explosive components only) with new improved technical solutions and securing access to the
most important raw materials, such as ammonium nitrate.
To improve on bottom line and meet shareholders expectations cost control is very important
for both companies. Utilizing synergetic through mergers and acquisitions and other cost
improving programs has been run. In this context the ability to rapid changes is important.
1.6 Changing the company

In Dyno Nobel we have run a few change programmes over the years. When Indusrti Kapital
acquired the company in 2000 a 5-year business plan was developed. The plan aimed at
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improving the result, the EBITA, from approx. 180 M NOK in 2000 to some 750 MNOK in
2005. They more than reached their goal.
The transformation plan required to meat the goal of the 5-year plan was called the Spinnaker
Program. To coordinate (and in some instances lead), track progress in both milestones and
benefits as well as establish resources to meet the plans and budgets in the Spinnaker
program, the Central Executive Team (top management group) established a Project
Management team or a task force, the Spinnaker Programme Office. The Program Office, led
by a very respected senior top manager, consisted of seven members (of whom I had the
honour to be part) and operated in parallel with the established line organisation for the first
two years of the change program.
As part of the Spinnaker program the company merged with an American company, Ensign
Bickford in 2003. The Ensign Bickford Company had recently received the Szhingo Prize for
their excellent implementation of Lean Production (Toyota Production System). The Lean
thinking is based on Toyota’s work with productivity improvements during several decades.
Lean is fundamentally the pursuit of identifying and eliminating waste. After the merger it
was decided to implement “Lean” in all of the new Dyno Nobel.
In their book, Lean Thinking2 , James P Womack and Daniel T. Jones summarize the
principles of ‘lean thinking’ used successfully by Toyota and others. They concluded that,
“lean thinking can be summarized in five principles; precisely specify the value by specific
product, identify the value stream for each product, make value flow without interruptions, let
the customer pull value from the producer, and pursue perfection.”
The adoption of lean principles in the old EBCo initiation systems business had dramatic
results. Over a four-year period from 1998 to 2001, ROI grew from 8.1 to 29.4%. Sales per
employee increased by 19%. Lead-time to the customer was cut by almost half while
inventories were reduced by 42%. Millions of dollars were taken out of working capital and
customer service improved! That is the power of lean. Given the experience of that process,
we should expect a 3 to 4 year period for lean principles to take hold and become permanently
established in a company. From those experiences one should expect to see many short-term
gains to be won along the way but that it will take a bit longer to change the culture and make
lean self-sustaining.
Many of the lean tools seem simple and straightforward. However, standalone tools only
become valuable when integrated into the business system as a whole. It is important that we
put the rollout of lean thinking across Dyno Nobel in context with the existing management
system. ‘Lean’ is not some new program or project to be implemented over the next year with
an end date when we can pronounce ourselves lean. These principles are to become part of the
culture of Dyno Nobel. The pursuit of perfection demands constant improvement to the way
we do business. Continuous improvement and the relentless elimination of waste must
become a way of life. Some of the more attractive implications of this way of thinking or
improving is that the changes in question should always be obviously improving on
performance and the changes will normally not be to extensive, we change only what we can
improve.
2
Author: James P. Womack and Daniel T. Jones LEAN THINKING SECOND EDITION ISBN: 0-7432-4927-5
Page 10 of 10
The Lean transformation in EMEA has started with focus on the Detonator plant in Gyttorp.
Some of the ideas defined in the LEAN concept were already in use, as an example; the
independent workgroups, modelled from the Toyota Production System, were implemented
some 10 years ago. During 2004 the detonator plant made extensive Value Stream Mapping
and identified a lot of Kaizen (improvement) proposals. The work continued with 5S (as a
tool to improve on safety), TPM (with “improvement groups”), Mistake proofing, Standard
Work, etc. Several improvements were made.
In 2005 the Lean work was expanded to also cover the outside of the pure production sites, to
include the rest of the Supply Chain.
Materials Order Entry
Supplier Lean
Production
Customer
Engineering Finance
Value Chain
The Lean philosophy seemed very successful and the top management accepted that the
introduction of “Lean” principles across Dyno Nobel could help produce the change needed
to become even more competitive. They also accepted that this is not a quick fix, such a
change will take years to accomplish.
The Lean Theories will be further described in chapter 3, Theory.
2 Method
Like most other companies also Dyno Nobel is struggling to become more profitable. One
way to achieve this may be by doing as one of the worlds most profitable and successful
companies in its category, the Toyota Motor Company, becoming “Lean”. This study is about
how to do that, the scope being to create a plan for transforming Dyno Nobel EMEA into
becoming a Lean Enterprise. Evaluation of the Lean philosophy or implementing the plan is
not within this scope.
When this all started all I had was a task, to present a plan for how to transform the company.
Through some of my colleagues from our sister companies in the US I was “told how to do
this”, their attitude being that “our way” is the one and only. However, probably through
some typical Scandinavian scepticism, I was not totally convinced that there was only one
right way to go ahead. After learning about the theories and philosophy of Lean through
literature I also participated in some Lean events at other Dyno Nobel plants, among them
one located in Port Ewan, New York. This plant was technically very similar to the one in
Gyttorp, Sweden, and they were both to adapt the Lean concepts. Still, they were also very
different, as the Gyttorp plant had implemented “Empowerment” some years ago versus the
American plant were still managed from a somewhat more hierarchical model. Needless to
say I learned a lot through this participation, however still not convinced the methods used
would be reliable should they be used in Sweden, from the assumption that the cultures are
so different that the methods and also measurements would not be valid. Much of the work
done here is based on a hypothesis that the methods chosen need be adjusted to mach local
culture.
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I’ve got input from organisations like The Lean Enterprise Institute with professionals such
as James P. Womack, Daniel T. Jones, John Shook and many more but also from more
local organisations like the Lean Institute of Sweden and Plan (a logistics knowledge
network).
Finally, to validate and adjust the theories for how to do this, some local events and projects
were run at the Dyno Nobel Plant in Gyttorp, 40 km north of Örebro in Sweden. For some of
those projects and events I’ve used consultants to some extent, in-house staff has run some,
myself have managed some and in one case I had assistance from a colleague from the US.
The Implementation Plan was then finalized based on input from literature and those cases
mentioned above.
In retrospect, in the recommendations part of this thesis, some ideas for how I would go
about should I do this all over again will also be mentioned. Even though not in the scope of
this thesis, I now have some experience in actually managing the implementation of the Plan
and I will share some of this.
Below is a visualisation of the workflow of the study
Defining the scope of the study

Choosing the subject, preliminary definition of the subject, preliminary literature search
Learning about Lean through participation in events and conferences as well

as studying literature and earlier work in the matter
Getting familiar with the literature about Lean and earlier work
Further literature studies regarding change management.

Deciding on J.P.Kotter’s method for change as a basis for the plan
Defining the subject or the problem of the study

Defining the subject more precisely, choosing some methods, hypothesis
Setting up the study

Defining the methods and areas (cases) for testing
Initializing and participating in some change programs and events

Implementing parts of Lean in chosen areas of the Gyttorp plant
Evaluating success, gathering and analyzing data
Creating the Plan

Writing the Plan (and have it approved for implementation)
Discussion and Conclusion

Risks and risk mitigation, what to look out for. What might have been done differently?
Some experience from using the Plan. Suggestions for further studies.
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2.1 Qualitative vs. quantitative methods
A qualitative research approach was utilised for this study. Qualitative research can be
defined as: “Research that derives data from observation, interviews, or verbal interactions
and focuses on the meanings and interpretations of the participants3 .”
Qualitative research seeks to understand and interpret personal experiences, behaviours,

interactions, and social contexts to explain the phenomena of interest, such as the attitudes,
beliefs, and perspectives of people in question.
Quoted from Wikipedia, the free encyclopaedia 4 : “In the social sciences, qualitative research
is a broad term that describes research that focuses on how individuals and groups view and
understand the world and construct meaning out of their experiences. Qualitative research
methods are sometimes used together with quantitative research methods to gain deeper
understanding of the causes of social phenomena, or to help generate questions for further
research. Unlike quantitative methods, qualitative research methods place little importance on
developing statistically valid samples, or on searching for statistical support for hypotheses.
Instead, qualitative research focuses on the understanding of research phenomena in situ; that
is, within their naturally occurring context(s).
One aim of the qualitative researcher is to tease out the meaning(s) the phenomena have for
the actors or participants. Quantitative studies, however, may also observe phenomena in situ
and address issues of meaning, and one criticism of this approach to qualitative research is
that the definitions offered of it do not distinguish it adequately from quantitative research
(for more on this issue, and about the debate over the merits of qualitative and quantitative
approaches, see qualitative psychological research).”
A quantitative research approach was not applied in this study. Reasons for this are that data
collection instruments, the research method and the method applied to analyse the data
according to the quantitative approach was not suitable for the focus of this study.
Quantitative research aims at testing a hypothesis; the approach is context free, and research is
often conducted in an artificial or laboratory setting. Data collection methods include
questionnaires and standardised interviews, and the outcomes of the research have measurable
results5 .
The focus of this study was the qualitative approach, researching the implications of
transforming an organisation to become Lean, in other words to make individuals change
behaviour in their interaction with others. Furthermore, the data collection methods, the aim
of research and the outcome of these qualitative research results have hardly no direct
measurable results, as they thus differ for example from that of a quantitative approach. When
running Lean events at the Gyttorp Plant (chosen as “test” site) with me as facilitator or
participant, the behaviour of the operators were observed while they were working in groups
on their tasks. The outcome of their behaviour was not predictable, nor directly measurable by
means of statistics. What could be measured however were the change in results from their
work, for instance as units per man-hour. The settings in where they were observed was an
3
http://www.library.nhs.uk/healthmanagement/ViewResource.aspx?resID=29079 29.june.2006
Holloway and Wheeler, Ethical issues in qualitative nursing research, Nursing Ethics, 1995; 2(3): 223-232.
4
http://en.wikipedia.org/wiki/Qualitative_research
5
http://upetd.up.ac.za/thesis/submitted/etd-07082003-104003/unrestricted/03chapter3.pdf 29.june.2006
Creswell, 2002:62-63; Holloway & Wheeler, 2002:16
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actual plant, doing their daily tasks, and not an artificial setting or laboratory. Still, there are
trails of quantitative analysis here.
2.2 Research Purpose

The major reason for conducting this study is to be able to create an implementation plan (or
model) that is as likely as possible to succeed. A secondary reason is to become more
experienced with the phenomenon of change management in general. From literature studies
we can find a lot of studies in the theme. Quite a lot of companies have performed similar
changes successfully, or so they claim, and are willing to share their wisdom. Through
scepticism towards the validity and reliability in some of those descriptions and the methods
found successfully in places as Japan and USA, as well as input from Scandinavian
companies that have, at least partly, implemented the philosophy of Lean and suggesting
different methods, there is a need for a few limited empirical studies before finally deciding
on a change plan for the entire European part of the company.
The overall hypothesis being that a “Lean” organisation is more profitable in the long run.
This hypothesis will hardly be challenged in this study as it forms the base for the study. The
secondary hypothesis is; that to be able to successfully change an organisation in Scandinavia
you need the employees willingness, that is, you need “to sell” the idea. The assumption is
that it is hardly possible to successfully force a change through. To be really successful you
need coconscious among all employees involved. The challenge then is how to make this
happen. To validate the hypothesises some cases will be studied.
From Yin6 we can learn that the purpose of an academic study can be exploratory, descriptive,
or explanatory. From this perspective the purpose of the study can be somewhat exploratory
since we wish to provide a better understanding of how the Lean philosophy can help us
improve a company as well as to understand how to change or transform it. The study can
also be considered descriptive in the sense that both the theories and the philosophy of Lean
as well as the case studies conducted are described. Finally, my research purpose is also partly
explanatory since I’m trying also to explain the nature of the Lean philosophy and also the
driving forces behind an organizations change through empowerment. However, from this
perspective this study is mainly to be considered descriptive in nature.
2.3 Research Approach

In regard to the previous discussion this study rely on a qualitative approach. The scope of
the study being to provide a plan, method or model and as a consequence a better
understanding of how to transform a particular company to become what we call a Lean
Enterprise.
From studying literature, including the Internet, the basis of an implementation plan could be
created. I’ve been seeking to find some common successes and also some traps not to fall
into and so inputs from some respected professionals in the field have also been considered
important. To validate a hypothesis, namely that we in Scandinavia is somewhat different
than people in the US or Japan (where most of the theories originate from) and that we need
to manage change a bit differently. The methods need to be standardized for the target group,
and to do so some case studies had to be conducted to verify that the (new) methods in
6
Yin, R.K. (1994). Case study Research. Design and Methods. Second edition. Thousand Oaks: Sage Publications, Inc.
Page 14 of 14
question are reliable and valid. In most of the case studies conducted I have been a
participator, hence participant observation is a method commonly used here. Due to all this
input, as well as personal experience in the field, however no type of in-depth interviewing
has been called for.
How to assure that correct and objective results have been measured will be thoroughly
described later on. Even though this is a plan for one particular company limited to
Scandinavia as geographical boundary, it’s still very important that the methods chosen will
be valid for this group.
Also personal experience and my deep and thorough knowledge about the company in
question is an important basis for the work here, and so the study is strongly influenced by
this knowledge, all mixed with my own reflections.
2.4 Research Strategy

There are several ways of conducting social science research. We can use experiments,
surveys, histories, analysis of archival information and case studies. Each strategy has specific
advantages and disadvantages, depending on three conditions (a) the type of research
question, (b) the control an investigator has over actual behavioural events, and (c) The focus
on contemporary as opposed to historical phenomena7 .
What distinguishes the different strategies, or the occasions when each are the better to use
depends on the circumstances. The three conditions mentioned above consist of a), the type of
research posed, b) the extent of control an investigator has over actual behavioural events and
c), the degree of focus on actual or perhaps contemporary as opposed to historical behavioural
events. The figure below can help us determine which strategy fits best.
The figure is copied from Yin, R.K. (1994). Case study Research. Design and Methods,
7
Page 15 of 15
In this study, besides the theories and philosophies around Lean and the Toyota production
system itself, the core of the Plan developed have been created around the methodology as
outlined by J.P. Kotter in his book "Leading Change" and by the systematic approach to a
problem as described by Dr. W. Edwards Deming and the continuous improvement spiral, the
PDCA wheel. Dr. Deming's approach is actually said to be the catalyst for the development of
the Toyota production system in the first place. The hole spirit of Lean circles around
continuous improvements, never to relax and be satisfied, to always strive for improvements
and to do so by the “Plan – Do – Check – Act” approach described by Dr. Deming. When
trying to inspire our employees to live by this philosophy I often use an athlete or a sports
team as an example to follow. Would such ever really think they’re good enough to stop
improving?
From all available literature, input from other sources as well as advices given by other
professionals a transformation or implementation plan has been created. Then some of the
theories from the plan have been tested in real life at some pilot areas of the organisation.
Based on the results and experience gained from those pilot areas the plan have been
evaluated and or adjusted.
From this we see that we have plenty of how questions, how to best transform the company?
We also have quite a few what questions, what to do to make this happen? However, we also
have some how many and some how much questions, especially regarding the use of resources
and results to expect. Unfortunately one might say we do not have control over behavioural
events to the degree many managers would prefer. We do however focus on contemporary
events.
The strategy chosen here was to conduct a survey in literature and mixed also with input from
visiting other companies that have conducted similar changes and then create a first version of
the Plan. To improve the Plan and to verify the methods some in-house case studies have been
conducted. Yin recommends that case studies should be used when the research questions are
of why and how nature, the strategy requires little control of behavioural events, and finally
when the focus is on a contemporary occurrence within some real life context. I wanted to
verify that the “Lean” philosophy and theories from the survey actually work and to do so
some case studies have been conducted. Also, I had some ideas of my own I wanted to test
out. Where applicable I also wanted to measure the resources used and the benefits gained.
Again according to Yin, case studies further contribute to our knowledge of individual,
organizational, social occurrences as well as and it allows an investigator to retain the holistic
and meaningful characteristics of real-life events, including such as organizational and
managerial processes.
2.5 Literature and Historical Study

The literature studies started with focusing on two main areas I felt important for this study:
The Lean Philosophy and Change Management. I have also been looking at how other
companies have succeeded in similar changes.
Through the Lean Enterprise Institute, with authorities in the field as Jim Womack and Dan
Jones, some literature were suggested and in some cases also provided. Further on I also got
access to literature as well as verbal advices, etc. through participating at conferences as; The
Lean Summit conference, Lexington, Kentucky May, 2004, The Lean Service Summit
Page 16 of 16
conference in Amsterdam, June 2004, The AME conference in Boston, November 2005, The
Plan conference in Stockholm, April 2004. Beside participating at conferences and through
literature, also information were gathered through company visits; Volvo Lastvagnar,
December 1, 2004 to study material flow, Finnboden AB in March 2004 to study 5S, Auto
Liv, June 2004 to study material flow, and others.
Some input have also been gathered through consultants, such as Chris Wilsher at the Belief
DA8 , Mikako Lago-Lengquist (5S) and Gert Frick at JMAC Scandinavia 9 .
Besides external literature, I obviously examined internal material (written as well as oral)
originating from employees within Dyno Nobel, mainly from the former Ensign Bickford
Company in the US, where they claimed to have implemented similar changes successfully. I
also had the privilege to participate in some internal Lean events at places like the Initiation
Plant in Port Ewan, New York , February 9 – 15, 2004, Value Flow Mapping event at the
Engene High Explosives Plant, June 13 – 16, 2004, and others.
During the literature studies I constantly aimed at taking the following questions into
consideration:
How is the research relevant to this study?
What differences do I have to be aware of (e.g. cultural)?
What challenges / solutions are essential for this study?
How were progress measured?
The literature review also outlined the instruments and methods used and more concretely set
the boundary for this research.
The structure of the literature and historical studies was:

The Lean Philosophy and the Toyota System. Having in mind the – we are so different
hypothesis. This may all be OK in Japan or in the US, but really, can all this be copied into
our world?
Change Management in General, mainly focusing on John P. Kotter and his eight-stage
process for change, and again the – we are so different hypothesis. Is this really valid also for
our company – in Scandinavia?
Next, as the theories from literature were analysed, were to identify the changes needed for
Dyno Nobel in Scandinavia to become a Lean Enterprise. Now the changes needed from the
Lean theories had to be put into the change model from Kotter.
2.6 Case studies

The cases studies here can all be seen as preliminary studies in implementing different parts
of the Lean Philosophy in practise. All the cases have been performed at the at the Dyno
Nobel Initiation Plant in Gyttorp, Sweden with one exception, the only administrative Kaizen
taken into consideration here, The Invoice scanning project. This case started at the financial
department in Dyno Nobel Sweden, but soon involved also the Norwegian part of the
company.
8
www.beliefgroup.com
9
www.jmac.se
Page 17 of 17
Through Value Stream Mapping of all the major value streams at the company, the cases to
study, or rather the cases to start with, where selected. This was a combination of my own
subjective personal perception of what improvements possibilities highlighted through the
Value Stream Mapping would give the best cost/benefit ratio combined with interest and
willingness from the managers involved. The cases selected are shown in the table below:
Date Place Case Participants

10-12 March 2004 Nonel Std. Work Jens, Stefan, Torbjörn,
Assembly Caroline, Susanne, Riitta,
Tina, George, Jonny, Thomas,
Margareta
Tim Saydam – Facilitator
Stig Nyqvist – Manager
Jerry Hurum – Facilitator
02. Feb 2004 H-268 5S All employees
22. Jan. 2004 H-267 5S All employees
25. March. 2004 H-2100 5S All employees
18. Feb. 2005 H-168 Kaizen, Waste Kenneth H, Andreas H, Riitta
reduction in Steel JW, Per H, Lars GA, Leif E,
shields logistics Hans O, Gunilla P
(Facilitator)
2. Dec. 2004 H-280 Mistake Proofing, Gunnar Ekman (Plant
missing caps in Manager), Thomas Brandel,
packaging Riitta J-Winther (Manager),
Johnny Olsson, Lotta
Boström, Gunn Skoglund,
Tina Andersson, Gunilla
Pettersson (Facilitator), Jerry
Hurum (Facilitator)
2005 -2006 Financial Administrative Kaizen, Finacial dep. In Gyttorp +
departments scanning of invoices
in Gyttorp
and Oslo
Table showing the cases studied
The results from some of those events or case studies are directly measurable in numerical
units whereas others only can be measured indirectly. The dates show the kick-off date.
Actually not all “cases” were finished in the same order they were started.
2.6.1 Data Collection

10
Yin argues that no source of information is better than others. In fact, they should be
considered complementary, and therefore a good study will rely on as many sources as
possible. When gathering information for studies, that be surveys, historical-, or case- studies,
a major strength is the opportunity to use many different sources of evidence. The use of
several sources of evidence means that the researcher has the opportunity to obtain multiple
measures of the same phenomenon that adds validity to the scientific study.
10
Page 18 of 18
In this study case studies (events) have been used to validate information gathered from
literature and sources as described earlier. According to Yin11 interviews are one of the most
important sources for case study information. The cases studies here can all be seen as
preliminary studies in implementing different parts of the Lean Philosophy in practise. All the
cases have been performed at the at the Dyno Nobel Initiation Plant in Gyttorp, Sweden with
one exception, the only administrative Kaizen taken into consideration here, The Invoice
scanning project. This case started at the financial department in Dyno Nobel Sweden, but
soon involved also the Norwegian part of the company.
Through Value Stream Mapping of all the major value streams at the company, the cases to
study, or rather the cases to start with, where selected.. For this last point I have, if not
conducted interviews, at least performed some discussions with people involved to get their
points of view.
In some of the cases I have been able to measure the changes obtained in numerical units and
often also in a monetary way. In the Standard Work event we could measure the increase in
capacity as well as the change in unit cost, as compared to the suggested solution promoted by
the local management. The operators’ experiences or points of view were also collected in a
perhaps somewhat superficial way combined with statements from their manager to validate
my own impression as an observer. It was possible to observe the change in attitude towards
the methods introduced. It was very easy also to visually observe the improved order and
tidiness in the work area (5S) and generally improved discipline. In the mistake proofing
events we could observe both how the participants changed behaviour from thinking that all
responsibility are in the hands of the manager and that they are only paid to use their hands to
start with proactive handling to avoid errors and to actually by their own initiative start
improvements meetings. To verify or at least back up my subjective observations it was
possible to measure the improvements as reduced customer complaints and improved
productivity. In other events, such as the 5S implementation the improvements could always
be measured in the form of freed up space, etc. The important factor here was however the
attitude the employees had towards the change program and the sustainability of the changes
introduced. Those observations are unfortunately less measurable in numbers and the
conclusions are in a greater ratio based on my own subjective observations and
interpretations. In the improvement project “Scanning of invoices” there has been a
combination of introducing new methods, measuring results by numerical units and
observation of participant behaviour and attitude.
The methods used in each case will be more strictly described in under the chapter named
“Empirics”.
2.6.2 Sample Selection

According to Saunders and Thornhill12 , sampling techniques provide a range of methods that
enable you to reduce the amount of data you need to collect by considering only data from a
sub-group rather than all possible cases or elements. Non-probability sampling is done
without chance selection procedures. Purposive sampling or judgmental sampling is a non-
probability sampling method that basically allows a researcher to select cases that seems to be
best suited to answer the research questions. This form of sampling is often used when
11
12
Saunders, M, P. Lewis and A. Thornhill (2000) Research Methods for Business Students, Harlow: Prentice Hall.
Page 19 of 19
working with small samples, especially in a case study when a researcher is looking for cases
that are particularly informative. When such a non-random or -probability sampling procedure
is used, one can only hope that those selected for study bear some likeness to the larger group.
The conclusions drawn from a study of a non-random sample are limited to that sample and
cannot be used for further generalizations13 .
To improve on validity and probability I’ve also had other people I trust criticise and help
interrogate in some of the cases chosen.
The sample selection used in this study is based on a judgmental sampling, which is a non-
probability sampling. The cases selected are mainly those that I have personally participated
in or have relatively good knowledge about. There are however also one case, the scanning of
invoices, where the input are referred to as of second order. That is, others have conducted the
data collection and analyses of most numerical values. As the validity of all the secondary
data is a bit difficult to ensure, those data have less influence on the conclusions made.
2.6.3 Data Analysis

Method of data analysis will be based on my own reflections, and might be considered a
philosophical perspective as well as an approach to qualitative methodology. Another school
of thought that emphasizes a focus on people's subjective experiences and interpretations of
the world is called Phenomenology 3 . That is, the Phenomenologist wants to understand how
the world appears to others, which in many ways is what this is all about. On the other hand,
this study is also somewhat related to Field research, and can by so be considered as either a
broad approach to qualitative research or a method of gathering qualitative data. The essential
idea here is that the researcher goes "into the field" to observe the phenomenon in its natural
state or in situ. As such, it is probably most related to the method of participant observations.
When analysing the data collected, the intentions were to find evidence or at least indications
to back up or give input to changes in the plan (objectives). Miles and Huberman14 present the
following three parallel flows of activity to explain the analysis.
Data reduction: The process of selecting, focusing, simplifying, abstracting and transforming
the data. The purpose is to organise the data so that the final conclusion can be drawn and
verified.
Data display: Taking the reduced data and displaying it in an organised compressed way so
that conclusions can be more easily drawn.
Conclusion drawing/verification: Deciding what things mean, noting regularities, patterns,
explanations, possible configurations, casual flows, and propositions.
Miles and Huberman15 list 13 specific tactics for sifting, ordering and organizing of data. For
a qualitative analyst, those tactics for generating meaning are important since it is a way to
reduce large amounts of data into a smaller number of analytic units. This facilitates for the
researcher since they can stay more focused and helps the researcher to elaborate a cognitive
map in order to understand local incidents and interactions.
13
Bouma, Gary D. and G.B.J. Atkinson. 1995. “Selecting a Sample,” pp. 137-63 in A Handbook of Social Science Research. Oxford
University Press: New York. Summarized by Ching-Fei Hsu. (http://government.cce.cornell.edu/doc/summary.asp?id=bouma1995)
14
Miles, M. B. & Huberman, M. (1994). Qualitative data analysis: a sourcebook of new methods. Second edition. Thousand Oaks,
California. Sage publication.
15
Miles, M.B. and Huberman, A.M. 1994. Qualitative Data Analysis: An Expanded Sourcebook, 2nd Edition, Thousand Oaks, CA: Sage.
Chapter 10: Making Good Sense: Drawing and Verifying Conclusions.
Page 20 of 20
I decided to reduce data by (Building a Logical Chain of Evidence and Making Conceptual/
Theoretical Coherence16 ) connecting the organized data with the theoretical constructs that
formed the base for the event in question to illustrate key findings. Furthermore conclusion
drawing/verification was used, as by participating in events, I might not be entirely objective
towards neither the data not the results from the events. The ability to verify hypothesises
should still be valid though. The analyses from the participant observations in the events were
conducted in a way in which I compared existing theory, according to our conceptualisation,
to our empirical findings. Here also as numerical data were analysed to help create
trustworthiness and reliability. Finally, conclusions of the research were drawn.
2.7 Validity and Reliability

The quality of conclusions derived from a matrix of data cannot be better than the quality of
ingoing data. A complete matrix cannot be good even though it looks good, if the data were
collected poorly. 17
2.7.1 Validity
Validity is the quality of fit between an observation and the basis on which it is made
according to Kirk and Miller18 . Validity is concerned with whether the findings are really
about what they appear to be about 19 . Yin20 has presented three commonly used tests for a
researcher to test the validity. These include construct validity, internal validity, and external
validity. Yin claims that internal validity only is used for explanatory or causal studies. This
study mainly is descriptive and therefore the test will not be dealt with further. Yin also states
that external validity deals with the problems of making generalizations of the case study.
This study is not aiming to make any generalizations; thus, neither this test will be taken into
consideration.
2.7.2 Construct Validity

There are three tactics according to construct validity: Use multiple sources of evidence;
Establish chain of evidence; Have key informants review draft case study report21 . In this
research I’ve used output from different events, both in the form of directly measured results
and as documents from events run by some of my colleagues, as well as from case studies, as
sources of evidence.
I have selected all cases to study from my knowledge of the company in question. This might
have decreased the validity to a certain extent, however I have no intention of generalizing the
founding’s to be used in other companies. Furthermore, I have been very conscious regarding
this possible weakness in the study and believe any serious errors have been avoided.
Phenomenologists argue that social situations such as business and management settings are
16
Miles, M.B. and Huberman, A.M. 1994. Qualitative Data Analysis: An Expanded Sourcebook, 2nd Edition, Thousand Oaks, CA: Sage.
Chapter 10: Making Good Sense: Drawing and Verifying Conclusions.
17
Miles, M.B. and Huberman, A.M. 1994. Qualitative Data Analysis: An Expanded Sourcebook. Thousand Oaks, CA: Sage. Chapter 9:
Matrix Displays
18
Kirk, J. and Miller, M. L. (1986). Reliability and Validity in Qualitative Research. Beverly Hills, CA: Sage Publications.
19
Making Good Sense
20
21
Page 21 of 21
functions of a particular set of circumstances, therefore the product of business research
should not be scientific, law-like positivists’ generalisations, as these generalisations lack
insight into involved social situations. Further, if we accept that an organisation’s culture is
unique and that the world of commerce is constantly changing, then generalisability is not
important, as the circumstances of today may not be relevant in a week or few months time.
As a consequence, phenomenology attaches little value to generalisation22 .
2.7.3 Reliability
The view of Miles and Huberman is that quantitative studies take place in a real social world
and can have real consequences in people’s lives; that is a reasonable view of “ what
happened” in particular situation. The researchers should not consider the work to be outside
the scope of judgment23 . Reliability refers to the stability and consistency of the results
derived from research: to the probability that the same results could be obtained if the
measures used in the research were simulated. Essentially, reliability is concerned with the
consistency, accuracy and predictability of specific research findings.
The issue of the credibility of research findings shadows the above discussion. Findings
should be subjected to the question ‘how do I know this to be true? Well, you wont. All that
can be done is to reduce the possibility of getting the results wrong. This is where sound
research design that pays attention to reliability and validity is important. Recognising that
threats to reliability exist is paramount in designing research. Subject bias is a potential
problem. Interviewing managers who are charged with Lean initiatives and consequently have
career interest in Lean can bias their response about Lean’s influences on competitiveness.
Furthermore, the organisations that participated have a business and market interest in the
success of Lean and it’s competitive value. All organisations that participated in the study
have made large investment in Lean initiatives and management is expecting a considerable
return on their invested resources. This situation alone could possibly bias participators
responses to questions and results from events, including myself as the Lean champion and
representing the management towards the participators. The same situation probably has
occurred also in the events referred to run by some of my colleagues.
I have strived to find the most suitable respondent with the right knowledge with regards to
the research area in each case. It is possible that if someone were to run the same event again,
the respondents might be more prepared because it has been done once before and they also
will know what to expect as results. It is however possible that they might be stressed by other
factors which in turn may alter the results of events. My impression was however that the
participants were relatively relaxed and enjoyed talking to me and that they really supported
the findings.
Yin has suggested that the use of a case study protocol and develop a case study databases are
techniques, which increase, research reliability. I have throughout this report explained the
procedures of my research. I have further organised the thesis in a way so that any reader or
researcher can retrieve any desired material. There is a risk that personal biases might have
been present to some extent, therefore the results could be questioned due to the influence
from the respondent as well as my own attitudes and values. All events and results have been
22
Mark Saunders, Philip Lewis, Adrian Thornhill, Research Methods For Business Studies, Prentice Hall, 2nd edition, 2000
paperback, ISBN 0273639773
23
Making Good Sense
Page 22 of 22
documented. One of the corner stones in the Lean philosophy is “continuous Improvement”
and by so there is a possibility that over the years the objectives, procedures, techniques and
processes might have improved which means that the results of the study with the same nature
might take another turn.
3 Theoretical frame of reference

The thought is that to be competitive and to survive in the long run a company or an
organisation depend on the ability to rapid change, and that small continuously ongoing
changes, involving empowered employees, have a greater success rate than those large forced
changes.
People are considered the most important asset of our business and to be successful for the
long term we need to take advantage of and utilize the skill and knowledge of our employees
(and suppliers, customers, etc.). At the same time, we acknowledge that our employees are
“self thinkers” that do not need an autocratic management style; rather a more participative
and facilitative leadership style is probably best.
David P. Norton, ex-CEO of the consulting firm The Nolan Norton Institute, later Director
with the Balanced Scorecard Collaborative states24 : "To execute strategy is to execute change
at all levels of an organization. Seems self-evident, but overlooking this truth is one of the
greatest causes of a failed transformation effort."
Imagine a typical business application today and ask: Why does it stay the same? Can we not
improve on it?
When we’re talking about change we’re talking about improving on a business process of
some kind. The tricky part being that a business process affects people’s behaviour. To
change a process we need people to change behaviour.
Toyota’s Lean Strategy25

”Brilliant process management is our strategy.
We get brilliant results from average people managing brilliant processes.
We observe that our competitors often get average (or worse) results from brilliant people
managing broken processes”
In many of the change models found in literature, an executive runs the change program.
There are statements as; ”You must lead the way26 ” and ”This is not a march you delegate to
the troops nor observe from afar”. There are questions like; why do employees resist change?
A less often described challenge is when the management itself resist change.
In my work I have seen examples where the change in question was triggered by one very
engaged middle manager. After convincing the top management of the need for change, he
often finds himself as responsible for implementing the change in the organisation.
24
http://www.fairdene.com/apx-c-theory.html Dec. 11, 2005
25
Professor Daniel T Jones, Chairman, Lean Enterprise Academy at the Lean Service Summit – Amsterdam, 23
June 2004
26
Nightingale, Deborah J., et. al., Transitioning To A Lean Enterprise: A Guide For Leaders, Volume I
Executive Overview, MIT Lean Aerospace Initiative, September 2000. http://lean.mit.edu/ Dec.31, 2005, p1.
Page 23 of 23
When the top management delegates this kind of responsibility to someone lower down in the
hierarchy a new set of challenges are created. We will look further into this issue later on.
3.1 The Lean Philosophy

The fierce competition imposed by mass production systems during and after the World War
II era led the Toyota Motor Company (TMC) to a thorough study of the production system of
the American automobile industry and in particular Ford (the Ford Production System – FPS).
The solution offered by Toyota led to a complete reconstruction of the company and soon
gave way to the introduction of an alternative production system referred to as the TPS27
(Ohno, 1988), which aimed at directly attacking any form of waste in the production process.
The JIT philosophy was developed in the framework of this new production system and
evolved exactly out of the need of the Japanese industry to survive in the post-war global
market. Soon, the value of the system was proven to the global manufacturing industry and a
great number of companies worldwide hastened to implement this model of production to
their own production systems.
LEAN is about creating more value for customers by eliminating activities that are considered
waste. This implies that any activity that consumes resources, adds cost or time without
creating customer value is a target for elimination.
It’s often said that Lean is more a philosophy than it is a system. We need to change the way
we think. It’s to continuously improve the way we operate. An endless fight against waste.
In this document I’ll be referring to Lean Production and to Lean Enterprise. The terms can be
defined as:
Lean Production (LP): The Toyota Production System as described in The Machine That
Changed The World 28
Lean Enterprise (LE): Lean Production principles applied to the entire company, and
external value chain -- customers and suppliers
In the MIT study regarding Lean transformation29 they state that Lean is all about beliefs and
behaviour, it is applicable beyond the factory floor to encompass the entire enterprise. I quote:
” A “Lean” organization understands and believes in the fundamental virtue of its Basic Lean
principles. Within that Lean organization, everyone is focused on identifying and eliminating
sources of waste and inefficiency. They look at the world through the eyes of their customer
and seek to fulfil customer expectations. They value only what the customer values. They
anticipate change and learn how to be responsive to make change their ally. They understand
the concept of flow, the power of sharing information, and the criticality of relationships.”
27
Leanness: experiences from the journey to date , T.C. Papadopoulou, M. Özbayrak
http://www.emeraldinsight.com/Insight/ViewContentServlet?Filename=Published/EmeraldFullTextArticle/Artic
les/0680160706.html, Dec. 31, 2005
28
Womack, J.P., D.Jones, D.Roos, The Machine That Changed the World; The Story of Lean Production.
(HarperCollins, 1991)
29
Nightingale, Deborah J., et. al., Transitioning To A Lean Enterprise: A Guide For Leaders, Volume I Executive
Overview, MIT Lean Aerospace Initiative, September 2000. http://lean.mit.edu/ Dec.31, 2005, p 7
Page 24 of 24
3.1.1 Lean, or the Toyota Production System

Lean production is an assembly-line manufacturing methodology developed originally for
Toyota and the manufacture of automobiles in the 1950s. It is also known as the Toyota
Production System. Engineer Taiichi Ohno is credited with developing the Toyota production
system and ultimately, "lean production." He discovered that through enhancing quality, in
addition to eliminating waste, his methodology led to improved product flow and better
quality. Production automatically improved and the waste of materials and resources was
reduced, hence creating a lean enterprise. There were two other gentlemen who also helped
shape the Toyota production system. They were Shigeo Shingo, a quality consultant hired by
Toyota, who assisted in the implementation of quality initiatives; and W. Edwards Deming,
who brought statistical process control to Japan. Today, there are many global companies,
automotive as well as other branches that have adopted "lean" principles to compete with
Toyota and other Japanese automobile manufacturers. The goal of lean production is
described as "to get the right things to the right place at the right time, the first time, while
minimizing waste and being open to change".
Instead of devoting resources to planning what would be required for future manufacturing,
Toyota focused on reducing system response time so that the production system was capable
of immediately changing and adapting to market demands. In effect, their automobiles
became made-to-order. The principles of lean production enabled the company to deliver on
demand, minimize inventory, maximize the use of multi-skilled employees, flatten the
management structure, and focus resources where they were needed.
During the 1980s, many manufacturing plants in the U.S. and Europe adopted the set of
practices summarized in the ten rules of lean production. The management style was tried out
with varying degrees of success by service organizations, logistics organizations and supply
chains. Since the demise of many dot.coms, there has been a renewed interest in the principles
of lean production, particularly since the philosophy encourages the reduction of inventory.
Dell Computers and Boeing Aircraft are examples of companies that have embraced the
philosophy of lean production with great success.
The ten rules of lean production can be summarized30 :
• Eliminate all unnecessary waste

• Minimize excess inventory
• Maximize production flow
• Prioritise production from customer order requests
• Meet customer requirements
• Always do it right the first time
• Empower workers to find problems
• Design for rapid changeover
• Partner with suppliers
• Create a system of continuous improvement
30
Improving workshop efficiency by Steven J. Feltovich, http://www.asashop.org/autoinc/june2004/manage.cfm
Jan 05, 2006
Page 25 of 25
So, what company would not like to improve efficiency, performance and productivity and at
the same time reduce costs and lead times? Almost sounds to good to be through! There are
however some companies that have achieved this.
3.1.2 Lean (Kaizen) Tools

Implementing lean is a process of discovery. If overhead is a symptom, kaizen teaches us you
can identify the underlying disease by asking “why” five times. Kaizen forces us to get to root
cause. Downsizing the organizational structure puts emphasis on eliminating unnecessary jobs
while lean, more importantly, emphasizes eliminating unnecessary work. I may concede that
simplicity in the workplace does not necessarily require a corporate culture rooted in Zen. It
does, however, require a conscious effort at eliminating unnecessary work. I believe we can
make a smaller company, not by reducing the number of people, but by reducing the number
of job classifications. That means jobs are broad, not narrow, allowing more flexibility.
Lean requires us to study and understand our processes. Our company had traditionally
thought that productivity gain was simply a result of getting the workers to progress on the
learning curve, reflecting the development of skill and dexterity when a job is performed
repeatedly. In the 1990’s we started to appreciate that this effect results from a wide variety of
additional factors. Improvement in product design and process technology, standardization,
better material utilization, reduction of inventories, improved layout and flow, just-in-time
principles, and improved organization all contribute to the productivity gains. Today, it is still
these interrelationships that we must strive to better understand. That is where our greatest
gains will come from - organizational learning. A systemic approach to productivity
improvement is what will yield the greatest results.
Process oriented thinking is a systemic and collaborative approach to cross-functional

problem solving. Reengineering in a particular area without consideration for the total system
can have negative effects elsewhere in the organization. Doctors must study the whole
anatomy before going on to specialize. In operations we tend to have specialists working in
many areas, design engineers, purchasing agents, distribution experts, who are experts in their
field but may not always consider the effects their decisions have on the whole. Will their
prescription for an illness react negatively with the cure prescribed by another?
Understanding processes means understanding how they interconnect as well as the individual
unit operation.
Basing operations strategy on lean principles will not guarantee lean results. Management
must truly believe in the creative ability of each employee and make everyone a team player
in order for lean to flourish. We seem to have been successful in getting cross-functional
thinking by creating decentralized, self-managed departments. Creating work teams means
putting maintenance, process engineering and quality engineering on the floor of the factory,
not in centralized departments. We shifted resources in Simsbury during latter part of the
1990’s to better accommodate understanding our processes to more easily identify waste and
eliminate it.
Lean has created cultural change at the Gyttorp plant. Change is upsetting, but it should not
create instability. For all the changes that were accomplished, the movement to a new way of
doing things was a managed process of adaptation, not a jarring crisis. We will be changing
Dyno Nobel, but it is a transition from one form of stability to another.
Page 26 of 26
There are many lean tools available to us in the toolbox. Some are useful in specific situations
but some should be implemented in all organizations to move the company towards becoming
lean.
The Lean Tools described in appendix 1 can be found at various places on the web, such as
The South West Manufacturing Advisory Service (SWMAS)31 , at Mepol, University of
Louisiana32 .
3.1.3 So, what do we have to change?

As mentioned earlier we need to have the end customer in focus and assure that we produce
only what he wants, at the time he wants it, with the quality he wants.
Looking at the company from the customer’s perspective, we are not interested in
departments, nor are we interested in internal company activities unless they help getting what
she wants. In doing this we need to put the value stream in the centre of our organisation. It’s
all about creating value for the customer. Ideally we should all be value adding. People not
directly involved in the value stream should at least help or support those who are. It can be
hard for a manager to realise he is not value adding. Why should the final customer be willing
to pay for his contribution? No wonder the lean transformation and empowerment often fight
resistance in the middle management level.
In the MIT Lean Aerospace Initiative33 we can read that ideally, the Lean Enterprise has
evolved into an agile, rapidly re-configurable, customer-focused, supplier-integrated, “virtual”
organization. Further on we can read that the organisational structure typically will be such
as;
The horizontal axis dominates the organizational structure, with teams aligned along the
customer value stream; there are a minimum number of management levels; and decision
authority is at the point of action. Large, bloated, “indirect” staff functions are mostly gone,
and any remaining staff is redeployed to value-adding activities in the horizontally oriented
structure.
A majority of the resources previously concentrated in the functional “silos” of the vertical
organization are now redeployed and integrated into the teams and other core processes. A
relatively small contingent of managers in each functional (core process) area may remain
centrally located at the Enterprise level to enforce necessary standards across multiple product
families and to facilitate professional development and career-path planning for the various
specialty employees now dispersed among the process teams.
31
http://www.swmas.co.uk/info/Introduction.php
32
http://www.mepol.org/site59.php
33
Nightingale, Deborah J., et. al., Transitioning To A Lean Enterprise: A Guide For Leaders, Volume I Executive
Overview, MIT Lean Aerospace Initiative, September 2000. http://lean.mit.edu/ Dec.31, 2005.
Page 27 of 27
Team-based management is implemented in all areas of the Enterprise, following a
comprehensive education and training program. The workforce consists of multi-skilled
workers, organized in properly sized work cells to optimise one-piece flow and accommodate
fluctuations in market demand. This concept applies to support functions as well as to
production.
All work activities, both direct and indirect, are organized to support the optimisation of
multiple customer value streams.
Customers and suppliers are involved in all phases of the product life cycle, from concept
development through product delivery and support.
Cross-functional interdisciplinary teams support and continuously improve all core processes
in the Enterprise.
From this we can assume that there is a huge magnitude of change with the lean conversion
process impacting everyone in the organisation. In the course of a complete conversion,
EVERY MEMBER’S JOB WILL CHANGE – almost completely, i.e.:
An operator sitting in front of his/her machine will become a “cross-trained” cell operator
walking between varieties of machines within a cell. As KanBan and flow emerge, production
control departments come to be seen as “non-value” added. As cells begin to handle their own
vendor raw material ordering from single sourced vendors on blanket order, the purchasing
department will shrink by 80%. A senior manager who has worked hard, achieved success
and “has it made”, suddenly has all sorts of “political” problems managing the transition.
To achieve such an organisation in Dyno Nobel we could organize backwards, beginning with
the needs of the product (value offering) & its value stream. Most managers manage forwards
from existing organizations, technologies & assets:
–“How can we get the product to flow in pull given our organization? 34 ”
• We must organize from customer perspective
• Manage the entire value stream for each product family to eliminate waste while
creating flow, pull, & progress toward perfection
• Optimise the whole, not just the parts
• Create Value Stream Owners
• Value Stream Owners held completely responsible for all aspects of the value stream
• Personal Business Plans of value stream owners aligned with total value stream
performance
• Organization structure must be re-defined to reflect value stream owner and co-
element owners
We can conclude that there are a lot of changes to manage when transforming into a Lean
Enterprise.
34
Statement from Jim Bayliss, EBCo, Simsbury, CT, USA.
Page 28 of 28
3.2 Creating a Strategy
In the ”MIT Lean Aerospace Initiative” the authors mention six core strategic concepts of the
Lean paradigm.
Customer and Value Stream

The starting point for Lean thinking is “value” as defined by the end customer.
Defining value requires thinking from the customer’s perspective and working inward to
the company’s capabilities and core processes.
The term ”value stream” refers to all the activities your company must do to design, order,
produce, and deliver its products and services to customers. A value stream has three main
parts35 ;
• The flow of materials, from receipt from suppliers to delivery to customers.
• The transformation of raw materials into finished goods.
• The flow of information that supports and directs both flow of materials and the
transformation of raw materials into finished goods.
There is often more than one value stream within a company and a value stream may involve
more than one company.
Waste Minimization and Continuous Improvement

Defining the value stream as indicated above provides a basis for performing an in-depth
analysis of each individual process and the activities it consists of in that value stream. Each
activity is classified into one of the following categories:
(1) It is an action that undoubtedly creates value.

(2) It is an action that creates no value but is needed due to safety, legislation or other external
causes, or we just don’t have the technology needed to avoid it.
(3) It is an action that creates no value and can be eliminated immediately.
FIGURE of WASTE MAP.
Activities in categories (1) and (2) are analysed further in an effort to improve them as much
as possible and eliminate unnecessary resource expenditures. This process never ends. The
organization implements a formal Continuous Improvement process that relentlessly seeks to
reduce waste of all kinds and continually improve the product and service delivered to the
customer. Consequently, Lean Enterprises realize ongoing reductions in response cycle times,
production times, costs, required production space, and errors. The workforce is heavily
involved in the Continuous Improvement process and is the primary source of ideas and
initiatives that generate improvements. This applies to the entire organization, not just
production operations.
Flow and Pull

Once the wasteful activities along the value stream are eliminated to the maximum
extent possible at a given time, the next Lean principle is put into practice: making the
remaining value-creating steps “flow.” Here the primary challenge is to discard the
“batch-and-queue” mentality prevalent in mass production and implement small-lot
production, with batch sizes of a single unit as the ultimate goal.
35
Richard L. MacInnes, Lean Enterprise Memory Jogger, Goal/QPC, www.goalqpc.com
Page 29 of 29
The idea with ”pull” is that the customer pulls the products from the producer. Products are
made to order, or to a ”supermarket” rather than the producer pushing products onto
customers.
Near-Perfect Product Quality

In a lean value stream there are no (or very limited) buffers. Material in work is reduced to a
minimum (working capital reduction), the value stream operates like a fine tuned watch. As
there are no buffers, all material supplied from up-stream must meet specifications. Defects
cannot be tolerated (if any is discovered they should be dealt with immediately). When this
happen, the whole value stream stops (help gain attention to eliminate the root cause of the
defect). TQM or Six Sigma programs have demonstrated benefits in this setting.
Horizontal Organization Focus

The traditional organizational structure (a “silo” with the various units representing the
functions of a mass production organization) is incompatible with the value stream flow. Its
design supports long production runs of standardized parts in large batches but does not
support one-piece flow and just-in-time (pull) production.
Companies that have successfully transitioned to the Lean paradigm have found
self-managed work teams organized along the value stream, including having responsibility
for planning, supplier and customer contact, to be an effective structure. In this structure,
work teams focus horizontally on a linked set of activities along the value stream, rather than
reporting up a chain of command through many layers. The teams can include members from
production, engineering, quality assurance, purchasing (supply chain management), human
resources, suppliers, and most important, the customer.
Relationships Based on Mutual Trust and Commitment

In companies of the mass-production world it is common to engage a large number of
suppliers who compete against each other for the firm’s business. Suppliers are rarely
engaged in product development. Relationships tend to be short-lived, one year at a time. The
Enterprise maintains a large staff of incoming inspectors to catch defects.
In Lean Enterprises, win-win arrangements are the norm, as are long-term relationships with a
few suppliers. Qualified suppliers are involved in product development. Target costing is used
to achieve continual reductions in costs, with the savings shared. The supplier ensures the
quality of the supplies delivered; no incoming inspection is necessary.
It is desirable in most cases to establish labour-management partnerships that stress win-win

arrangements. The workforce is multi-skilled and supports continuous improvement efforts.
Provisions are made for mutual sharing of benefits that accrue from the implementation of
Lean practices and continuous improvement activities.
The development of electronic commerce (e-commerce) is changing the manner in which

enterprises deal with suppliers and others (customers, customs, etc.). The cycle time for
ordering, shipping, receiving, and paying for supplies have been reduced from weeks to days
(or, in some cases, even to hours). Equally dramatic change is unfolding in business-to-
business (B2B) interactions, both in terms of their nature and speed. Strategic partnerships
can be formed very rapidly in response to business opportunities that may be available only
briefly. To play in this fast-paced game, enterprises must become much more “forward-
focused,” ever ready to move swiftly and deftly into the fray. It is interesting to note that
Page 30 of 30
Enterprises that have transitioned to the Lean paradigm are much better prepared to capitalize
on the new capabilities offered by the Internet than are companies that continue to operate
with a mass-production mentality. The horizontal organizational orientation facilitates the
agility and responsiveness required for the new mode of enterprise functioning.
In his book Japanese Manufacturing Techniques36 , Richard Schonberger explains, in clear

detail, how the Japanese use a different, better manufacturing system, pioneered by Toyota
and built around single piece flow, waste elimination, just-in-time production and delivery,
and other simple principles independent of culture.
In MIT's five-year study of the world automotive industry, The Machine That Changed the
World37 Schonberger's 1982 conclusions are reinforced. Widely read, it focuses on
comparisons of quality and productivity. Conclusion: plants using the Toyota system,
renamed "lean production", significantly outperform traditional plants — whether located in
Japan or not. The definition and building blocks of lean became widely understood.
The effort to convert to Lean gained momentum. A reliable means of implementation

emerged when kaizen events became the accepted vehicle for the transformation. Hundreds of
American companies have conducted thousands of Kaizens. These cross-functional, six to 10
member teams spend two to five days focused on a defined area of the plant. Using
standardized tools and techniques; they analyse, brainstorm, implement changes, measure
effect, and document the new system.
In their book, Lean Thinking38 , James P Womack and Daniel T. Jones summarize the
principles of ‘lean thinking’ used successfully by Toyota and others. The book is
recommended reading as it provides a dependable guide for action in a ”lean”
implementation. They concluded that, “lean thinking” can be summarized in five principles;
precisely specify the value by specific product, identify the value stream for each product,
make value flow without interruptions, let the customer pull value from the producer, and
pursue perfection.” They also advice the readers to ”Just do it” in the spirit of Taiichi Ohno39
and other pioneers of the Toyota system.
When we adopt the lean principles they will become part of the company culture. It is
important that we put the rollout of lean thinking across the company in context with the
existing management system. ‘Lean’ is not some new program or project to be implemented
over the next year with an end date when we can pronounce ourselves lean. The pursuit of
perfection demands constant improvement to the way we do business. Continuous
improvement and the relentless elimination of waste must become a way of life. The good
news is that Dyno Nobel has established a solid framework for enabling the implementation
of the change to lean.
Following are the vision, mission, critical success factors and values that make up that
framework and are shared across all Dyno Nobel business units.
36
Richard Schonberger, "Japanese Manufacturing Techniques" (1982)
37
James P. Womack, Daniel T. Jones, Daniel Roos, 1990, The Machine That Changed the World : The Story of Lean
Production (Paperback) Author: ISBN: 0-89256-350-8
38
Author: James P. Womack and Daniel T. Jones LEAN THINKING SECOND EDITION ISBN: 0-7432-4927-5
39
http://www.strategosinc.com/taiichi_ohno.htm, Jan 14, 2006
Page 31 of 31
3.2.1 Vision
The vision is what we want to achieve. All our strategies and tactics are planned around
fulfilling the vision.
Dyno Nobel will be recognized as the leading explosives company in the world
by supplying solutions that create value for customers, owners, and employees.
3.2.2 Business Idea (Mission)

The Business Idea or Mission describes the activities we will engage in to achieve our vision.
Dyno Nobel will develop and supply solutions, either as products and services
or value-in-use solutions, to selected commercial customers in the world’s
major explosives market.
Dyno Nobel will operate in all major market segments with a full range of
explosive products and services
These include the world’s best initiation systems, explosives products, and
delivery systems, which support.
Global innovation and local solutions.
Resulting in strong financial returns for our owners
3.2.3 Critical Success Factors (CSFs)

Dyno Nobel operates with six Critical Success Factors as the areas of focus that have been
chosen as essential for us to accomplish our vision of being the “leading explosives company
in the world.” These six CSF’s represent what is most important to the Dyno Nobel
stakeholders - our customers, employees and shareholders.
• Health, Safety and Environment

• Customer Relationships & Market Development
• Cost Optimisation (Including Quality)
• Technology & Innovation
• Organizational Development
• Leveraging capabilities globally
The Six CSF’s are the starting point for strategy deployment in Dyno Nobel. Improvement
efforts should only be conducted if they clearly support the CSF’s.
3.2.4 Values LEAN

Dyno Nobel has identified values that WORLD’S LEADING
EXPLOSIVES
guide the desired behaviours in the COMPANY
organization. Common values bond us
IMPROVEMENT
together as an organization and a team.

CONTINUOUS
EMPOWERED
INNOVATION
CUSTOMER
OPENNESS
Values create the company culture – they

PEOPLE
& TRUST
FOCUS
way we treat our customers, each other

and our stakeholders.
Page 32 of 32
SAFETY
All of the Dyno Nobel values are addressed in the concept of lean. Safety, of course, must be
at the foundation of any of these lean manufacturing efforts. It is the foundation without
which the others cannot be supported. Lean has a core value of customer focus. Lean clearly
defines a process for continuous improvement. Lean, through empowerment of the
workforce creates a culture that demands openness and trusts and encourages innovation at
all levels of the organization.
The framework is in place to align all of our employees to be engaged in the business and
work towards our vision.
VISION
VISION
World’s
World’s Best
Leading
Explosives
Explosives Company
Company
GOAL
VALUES
GOAL
GOAL
CSF
MISSION
CSF CSF
CSF
CSF
CURRENT Critical Success
POSITION Factors
The vision, mission, critical success factors and values are being deployed throughout the
organization with a focus on teamwork and mutual accountability in order to achieve buy-in
and commitment. We have been tasked with presenting a strategy for Dyno Nobel that
deploys lean practices to help us achieve our vision. Our first priority needs to be the
realization of benefits from investments already made. At the same time, we must recognize
that developing and implementing strategic as well as operational plans for future markets and
technologies is a requirement for long-term growth and viability
Lean is all about delivering value to the customer and the alignment and integration of all
functional activities around the delivery of the ‘value proposition’ supporting our
transformation to a solutions provider. Lean principles consider the entire value stream, from
concept to delivery, and tools for streamlining product development and product introductions
such as electronic detonators. Lean demands alignment of the organization and establishing
bottom-up as well as top down communication that is vital in the business planning process.
3.2.5 Planning for change

In any plan we develop it is imperative that we focus on the customer. The manufacturing
operation begins with the customer and ends with the customer. Customer need determines
product design. Product design determines the necessary process technology, which
determines facilities planning and labour requirements. Distribution strategy may determine
Page 33 of 33
factory location and ultimately the delivery system, which ends at the customer. The total
productive system is in service of customer need.
There are five principles for lean thinking that we should consider during implementation40 :
Specify Value
Value can only be defined by the ultimate customer. We should precisely
define value in terms of:
–Specific products and services
... with specific capabilities
... offered at specific prices
… through a dialogue with specific customers
Identify the Value Stream

The value stream is the set of all specific actions required to bring a specific
product through the 3 critical management tasks of any business:
Problem solving task
…running from concept through detailed design
Information management task
…running from order taking through detailed scheduling
Physical transformation task
...proceeding from raw materials to a finished product in the hands of the
customer
Make Value Flow

Once value has been specified and the value stream has been identified and
mapped, wasteful steps need to be eliminated and the value creating steps need
to be made to flow without interruption.
Customer Pull
Once the 3 management tasks have been optimised for flow, products are
designed and launched quickly, order processing is streamlined and production
is completed in hours instead of weeks, we can let the customer pull from us
rather than pushing products into inventory.
Strive for Perfection

Value can be specified more precisely and there is no end to the process of
reducing effort, time, space, cost and mistakes. Continuous improvement is
just that – continuous.
If there is an overall theme to our lean strategy, it must be that we foster an environment of
change and challenge the status quo. Following the formula for success that got us where we
are today could lead us to failure tomorrow. We must achieve continual and rapid
improvement. Many of the initiatives in Dyno Nobel of the past few years, ISO 9000, SAP,
Spinnaker, Icarus, Stage-Gate, Management System Audits, and so on have had a positive
impact on operations, but I question if they have truly changed the lives of our people.
Although operations have often taken on the program of the month, we have not necessarily
40
Lean Thinking and Strategic Asset and Service Management , Jan 05, 2006
http://www.mro.com/corporate/pdf/LeanMfgandSAM.pdf
Page 34 of 34
been the dynamic leader of change. Most managers look at implementing new programs as
extra work for an already busy day. It is difficult to create the time necessary to retool or
reengineer in order to stay competitive when people feel overwhelmed. Operations personnel
see themselves busy keeping the wheels turning and it’s impossible to fix the bus when it’s
travelling down the road at 100 km per hour. But, if our vision is grand, ambition will always
outpace resources. We must accept this as a normal condition. Unreasonableness in our
ambitions is a good thing. To achieve lasting change we must foster a culture of change, not
simply implement a program.
In the future we need to stop rewarding for doing things the old way. Our strategy deployment
process and CSF’s will help in prioritising the vital few areas to focus on.
We must be open to learn from others and encourage a learning organisation by rewarding
people for how much they learn. Everyone should be encouraged to understanding the
complete value stream so they will seek to optimise the total, not just optimise its constituent
parts close to oneself. Our goals should be organisational, not just functional.
Everyone should embrace change. We should all encourage constructive discontent and ask,
“Why?” Why do we do things the way we do? Our performance measures should be
questioned. Are we managing by the right numbers? Operators should become the owner of
the processes and be the first line of attack against problems on the shop floor. Machine
downtime shall not be accepted as normal (ref. the case “Standard Work” under Empirics).
We must question new technology, “Is it appropriate?” Only what is “sold” should be
produced - every day. We must make partnerships with suppliers and customers. Everyone in
the organisation need to ask the question, “How do I add value?” We need a culture that
permit and encourage creative and innovative people to try and that also accepts some failures
as we strive for perfection.
In literature there are plenty of wisdom regarding change towards becoming Lean. In their
book, Value Stream Management for the Lean Office, Don Tapper and Tom Shuker provide
us with some recommendations when implementing the lean principles in the office
environment.;
Communicate, communicate, and communicate! We need to make sure everyone, both
upstream and downstream of the area where a particular ”Kaizen” event takes place
knows why it’s happening.
Address negative behaviour early in the implementation. If someone does not seem to go
along or display negative behaviour, we should talk to this person privately. We should
listen; as people’s feelings are for real, so active listening is important. We might have to
assure people they will not loose their jobs due to the improvements.
Do not let a problem stop the process. Unforeseen problems can occur that makes a
certain change impossible. Acknowledge this problem and reschedule the change event.
Consider each Kaizen event an experiment. Let’s say you underestimate the time a certain
change will take or didn’t anticipate the effect it will have on a neighbouring department.
In change management we will make mistakes. We should learn from them.
Reward and recognize people’s efforts. We should show people respect, treat them with
honesty and integrity every day.
Be present. The value stream champion and top managers should be there for people, meet
and talk to them every day.
Be flexible. Things not planned will occur, and things planned for will not turn out as
expected. Still, all are opportunities for more learning.
Page 35 of 35
In their book, Lean Thinking41 , James P Womack and Daniel T. Jones also provide some
advice when implementing Lean production.
1. Find a change agent (how about you?)
2. Find a sensei (a teacher whose learning curve you can borrow)
3. Seize (or create) a crisis to motivate action across your firm
4. Map the entire value stream for all of your product families
5. Pick something important and get started removing waste quickly, to surprise
yourself with how much you can accomplish in a very short period.
Later on42 , they also warn that many companies overlook step four, which according to them
is the most critical. The outcome of this impatience often is that the kaizen offensive with
disappointing results becomes another abandoned program, soon to be followed by a
”bottleneck elimination” offensive or a six sigma initiative, or......
This roll out plan has been developed in cooperation with my colleague Gunilla Petterson and
with input and advice from Jim Bayliss from the US part of Dyno Nobel. The plan follows an
eight-stage process as outlined by John P. Kotter in his book, Leading Change43 . Still, we
have made an effort to adopt advise from some well known Lean implementation specialists
into the plan. It’s also tailor made to fit the Dyno Nobel organisation to our best knowledge.
1) Establishing a sense of urgency Defrost

2) Creating a guiding coalition the
3) Developing vision and strategy Status Quo
4) Communicating the change vision
5) Empowering broad based action Introduce
6) Generating short term wins New Practice
7) Consolidating gains and producing more change
8) Anchoring new approaches in the culture Self Sustaining
Dyno Nobel has established a solid framework for enabling the implementation of the change
to lean. The first 4 steps of the process are aimed at defrosting the status quo.
4 The Plan
4.1.1 Establishing a Sense of Urgency
Dyno Nobel faces competitive challenges as a global company, as well as in each business
unit, which demand an immediate sense of urgency. Our people need to understand the need
for improvement and change if they are to be asked to go beyond the call of duty. Corporate,
as well as each business unit, has performed SWOT (Strengths, Weaknesses, Opportunities
and Threats) analysis. We need to raise everyone’s awareness of those weaknesses and
threats. Having everyone understand the challenges in front of the business is crucial to
gaining needed cooperation.
41
James P. Womack and Daniel T. Jones LEAN THINKING SECOND EDITION ISBN: 0-7432-4927-5
42
Freword in the book ”Learning to See”, M.Rother and J.Shook. Lean Enterprise Institute.
43
John P. Kotter, Leading Change is published by the Harvard Business School Press, 1996.
Page 36 of 36
We’ve had our best results ever in the last years and the sense of urgency has been rather
absent for a while. With the changes coming through new ownership we might be able to
raise the urgency level within the organization.
4.1.2 Creating The Guiding Coalition

The change effort must be guided by a powerful coalition that will act as a team. No one
individual can communicate the vision to such a large and diverse workforce, eliminate all the
key obstacles and manage dozens of change projects. A strong team of credible leaders is
needed to convince lots of people to implement the decisions.
We are (2005) shifting from a management model to a leadership model in Dyno Nobel. A
strong senior management team is in place that believes in mutual accountability for
outcomes. The business unit (BU) senior management teams (SMT’s) are proven leaders that
have broad, relevant backgrounds and education.
Produces
Management Model
Predictability &
Planning Order
Organize & staff
Control & solve problems
Leadership Model
Produces
Define future vision
Change!
Align people with the vision
Motivate & inspire
Our leadership teams must develop common goals that are both sensible and inspiring. We
must all demonstrate true openness and trust as we strive to implement lean thinking.
4.1.3 Developing Vision And Strategy

We start at the strategic planning process. The process is much more than just developing a
budget for the next twelve months. Strategy is not just incremental tactical planning. An
organization must know, what it is, and what it wants to be. Small businesses are often run by
the owner or a limited group of individuals who operate on intuition, or gut feel. They know
what they want. These leaders have little difficulty in translating their vision of the future into
day-to-day business operations. After all, they are close to the action. In larger companies,
such as ours, with many more individuals to carry out the work, things are not so simple. The
filters of management make it harder to communicate a common goal and indeed, many
times, management itself does not speak with a common voice. The vision must capture the
meaning and direction of the company. The vision must be accepted and felt by all. It
provides power to unify the organization. The vision provides Deming’s constancy of
purpose.
The purpose of the vision:

• To clarify general direction for change
• To motivate action that is not necessarily in the individual’s short term best interest
• To efficiently coordinate the actions of motivated people
Dyno Nobel Vision:
Page 37 of 37
Dyno Nobel will be recognized as the leading explosives company in the world by supplying
solutions that create value for customers, owners, and employees.
For Dyno Nobel, the commitment to supply ‘solutions’ is a change from our previous
products and services portfolio. We are stating a change in direction that goes beyond our
previous offering.
4.1.4 Communicating The Change Vision

We have been rolling out the vision and values during the autumn of 2003. This is an
extremely important step in getting everyone onboard toward achieving the vision. We must
achieve alignment of our resources through the deployment of the vision, values and CSF’s.
Operations are where most of the company’s capital assets are located. It is also where the
majority of the company’s people are. It is the strengths of those people assets that have the
most to contribute in realizing the vision. We can activate our capital assets by switching on
the power, but we must sell the vision through strategy deployment in order to activate our
most powerful assets - people. Total employee involvement is the engine that will power us to
success.
Business unit strategy must be aligned with the overall company vision. In the end, long-
range strategies and CSF’s must be translated into short-range plans that are clear to
everyone. Then we have to agree on deliverables to measure progress against. ”All projects,
by definition, have deliverables. In an iterative approach, the main deliverable (the
application) can be divided into smaller deliverables (e.g., modules, functions, or user story
implementations), in order to define an iterative, milestone-based delivery schedule.44 ” The
implementation timetable will have to be set according to available recourses, and will not be
detailed in this document. Communication and information sharing relative to achieving the
vision is however a must.
In communicating the vision and values we should remember to keep it simple without using
technical jargon. We should paint a picture of what the vision will feel like when we achieve
it. We must lead by example; it is the loudest form of communication, especially when it
conflicts. We should use every media possible to communicate, use every interaction, every
day. Repetition is important. We must explain any inconsistencies and answer the hard
questions. We must listen as well as be listened to – every criticism is an opportunity to
further embed the message.
We propose to use a team based strategy deployment process that will energize the
performance management process, support total employee involvement and create an
environment where continuous improvement is a way of life.
There are four essential processes:
1 Strategic Planning
The top management establishes strategic goals based on customer Strategic
Planning
expectations, external factors such as the competitive environment, and the
organization’s internal resource capabilities. The team determines strategic Alignment
initiatives and financial goals for the calendar year. Through
2 Alignment through Deployment Deployment
44
Test-based Project Progress Reporting by John Ferguson Smart,
Performance
http://www.stickyminds.com/sitewide.asp?ObjectId=10094&Function=DETAILBROWSE&ObjectType=ART Management
Continuous
Improvement
Page 38 of 38
Dyno Nobel SMT’s conduct meetings to determine key performance indicators (KPI’s) and
establish goals that will support the CSF’s. These meetings provide for both the vertical and
horizontal alignment necessary to direct the company’s people assets toward the vision. It is
important that we provide the time for all the teams below this level to also meet and set
common goals all the way to the shop floor and all the way to the bench at the mine (end
customer). A team is described as a manager/team leader and all the individuals who report
directly to them. The team objectives meeting are a carefully designed meeting for a group of
individuals who must work together effectively and efficiently to accomplish specific
objectives. We propose to structure these meetings to facilitate our implementation of lean.
These meetings should include members of support areas to ensure alignment horizontally
across functional groups. Experience from the Gyttorp Plant show those are normally one to
two days in length and all team members will be dedicated to working on the next year’s
goals during that time. Early morning starts and late night finishes are common. This should
continue in a regular yearly cycle.
SMT members review the goals developed by their BU with their subordinate team leaders.
These team leaders develop action plans with their teams for approval by their SMT member.
This is a three-step process:
1. Team leaders reporting to the SMT member hold team meetings with his/her
subordinates to present the CSF’s, KPI’s and goals and provide the
opportunity for discussion and clarification. This meeting is not for changing
the goals. It is purely for everyone to understand what is before him or her.
2. Develop Action Plans to support the goals. This is done by having additional
meetings at further levels and having team members submit individual plans
to the team leader who will consolidate them into one plan.
3. Team leaders review the action plans with their SMT member for approval.
Ideally, this is done at a meeting with the entire team to allow an open forum
and discussion with the SMT member.
The completed Action Plans are the goals for the team members. Team members generally
find this process effective and rewarding because, when they are finished, they know exactly
what they have to do rather than be assigned some nebulous goal that is not specific enough.
This process diagram illustrates the deployment of the company’s strategy and goals.
Corporate Goals
and CSF’s
The intersecting triangles in the diagram
signify the linkage between
organizational layers in executing the
Corporate Executive Team
CSF’s, and the vertical and horizontal CET
Team KPI’s/Goals
arrows represent cross-functional

alignment.
Business Unit Teams
SMT’s Team KPI’s/Goals
Through this process, leadership has
visibility to how the company’s Operating Units, Plant
resources are being allocated. Are the & Functional teams Team KPI’s/Goals
company under utilizing people, or has it

over committed? Leadership can Natural Work
Teams Action Plans
reallocate or add resources based on
strategic priorities because they have a clear From Dyno Nobel TOL handbook
Page 39 of 39
picture of every team’s action plans. The process is both top–down and bottom–up. If there is
a current weakness in communicating the vision it may be the deployment process for
aligning the organization. The top two levels in the organization have taken steps towards
alignment. However, it is not clear that this process has been completed at lower levels of the
organization (shaded triangles), hence the suggestion for structured team objectives meetings
at all levels.
It is also necessary for teams at the same level to meet to ensure horizontal alignment among
the members as well as the leaders.
Goals are specific written statements of what is to be accomplished. They include the
timeframe of accomplishment (when), a quantitative measure (how many), a qualitative
measure (how well) and a measure of cost (how much). Dyno Nobel uses the S.M.A.R.T.
criteria for writing goals. They must be Specific, Measurable, Aligned, Realistic and Time
driven.
We must require the entire organization to provide training and take the time to understand
their part in delivering value to our customers to achieve the vision. This is an important step
in completing this 8-stage process towards achieving the lean change. The strategy
deployment process energizes performance management, as employees have an improved
sense of how their role ties into the larger picture.
3 Performance Management
Strategy deployment also requires feedback on how well we are performing against plan. A
formal performance management process known as Managing Human Performance (MHP) is
utilized in Dyno Nobel. The strategic deployment process is defining the performance
measures for the company, individual departments, and people themselves. Simply, “you get
results for what you measure.”
The MHP process includes goal setting, an evaluation of how well people practice the
Set Your Goals Complete your If agreed, choose

Start of Year other reviewers
with your Mgr. Dev. Action Plan
- Establish New Booklet - Current Job - Advise Reviewers

- Future Opportunities
Discuss Values in
Practice expectations Mid Year Review End of Year
with Manager Review
-Discuss the behaviors - Review your goals - Assess Goals

and how you will be - Review other parts of MHP - Progress on DAP activities
assessed on these as agreed with your - VIP Assessment
Manager - Input from Other Reviewers
- Assess Overall Performance
From the Dyno Nobel HR handbook
company values and a discussion on each individual’s personal development plan:
Page 40 of 40
Our strategy deployment process demands we set SMART goals with hard measurement
criteria - management by the numbers. But we must be sure we have the right numbers. The
performance measures we put in place must consider the whole productive system. If
machine efficiencies are our primary measurement of productivity, we’ve got it wrong.
There are four dimensions of competitiveness that are traditionally used to measure the
operations function:
• Cost
• Quality
• Dependability as a Supplier
• Flexibility/Service
Cost
Although all the dimensions of manufacturing performance are important in competitiveness,
the cost factor is the one that is essential. The ability to produce at low cost provides the
strategic advantage of being able to compete on the basis of price. Factors such as product
design, process technology, asset utilization, labour productivity, and inventory management
all contribute to the resulting cost.
Process technology must be considered in the initial product design. Whether the process is
manual, or automated will determine labour costs. Technology should be the best available
for the need. Equipment or asset utilization is an important cost factor. We must demonstrate
adequate returns on investment dollars. Although new technology can be flashy, production
volume must pay for the investment. The planned, rapid introduction of new products by
R&D will demand that capital investments pay off in much shorter time periods. As products
become obsolete, so does much of the equipment used to manufacture them.
Labour must increase productivity. More accurately, we must provide the tools for labour to
be more productive. The tradition of treating operators as machines that can take verbal orders
must go. We will organize work teams and empower them to increase productivity in an
environment of continuous improvement.
Quality
As earlier stated with reference to the MIT study, Transition to a Lean Enterprise, the
importance of the quality factor in measuring competitive performance has been highlighted
by Japanese dominance in many markets where product quality is cited as the reason a
customer purchases a particular brand. Customers are sometimes willing to pay more, or
accept longer lead times, for delivery of superior products. Quality is a requirement to
compete in any industry.
The total quality control effort simply targets manufacturing to do it right the first time.
Striving to be compliant with ISO 9000 requirements is a prerequisite to survival in a global
market. It is a tool to standardize methods and eradicate variability in order to get better. ISO
9000 has implications beyond procedures and documentation. It has forced linkages between
the organizational functions and improved communication.
Dependability as a Supplier
A reputation for dependability and quick supply is a strong competitive weapon. The
customer may sacrifice cost in order to obtain on-time delivery when they need an item.
Scheduling and coordination of all elements of the productive system determine the ability to
produce quickly and on-time. Our customer service policy of two-week delivery in the
Page 41 of 41
commercial marketplace is a distinct competitive advantage. Our challenge is to improve
upon this and reduce lead time (from order entry to delivery) for all product lines.
Flexibility/Service
How standard is a product? The ability of the manufacturing operation to be flexible and
customize products will depend a great deal on the level of understanding and integration of
its processes. Product design will determine process technology and the technology
determines flexibility. A key performance measurement is the speed at which new products
are brought to market. If we are not first to market, we are playing catch up.
We need the management teams to utilize these four measurement areas (cost, quality,
dependability, flexibility) as KPI’s. Metrics should be established and the goals should be
aggressive. By definition, if we are to close our performance gaps, the difference between our
metric targets and actual performance, we will achieve our goals and support the corporate
CSF’s and vision. The lean tools must be leveraged to work on the drivers of the relevant
KPI’s to effect gap closure. For example, lead-time reduction can be gained if we focus on
drivers such as batch size, inspection time, set-up, etc.
Dyno Nobel has a solid management system in place that includes strategic planning,
alignment through deployment and performance management. These processes address the
first 4 steps in Kotter’s process and so we have a strong foundation on which to build.
4 Continuous Improvement
The next 3 steps of the 8-stage process are aimed at introducing new practices in the
organization. These steps are most important to introducing a continuous improvement
culture, not just another cost improvement project, across the Dyno Nobel organization.
4.1.5 Empowering Employees for Broad Based Action

In order to empower people we should have an organization structure that supports giving
more responsibility to lower-level employees. Organizational structure also must support the
CSF’s and corporate values. The structure should consolidate resources and responsibility for
value streams and eliminate functional silos. Independent silos that don’t communicate well
can hamper our striving to speed everything up and provide quick response to our customers.
We should operate without layers of middle-level managers who second-guess and criticize
employees. The structure must be aligned with the vision.
Dyno Nobel has restructured over the past years from a collection of affiliated companies to
the present day matrix organization to take advantage of its global position.
We are living in the information age but many of the jobs we occupy have not been rethought
since the industrial revolution. Any number of reengineering management books offer advice.
The challenge is to reduce all those nice sounding slogans to workable practices. How much
hierarchy is required? People can intellectually accept the need for a flatter organization to
increase competitiveness, but they will feel the overwhelming pressure the flattened
organization puts on them. The work doesn’t go away - they are busier. How do we unload
the burden? Our business machine must be redesigned like an engineer would a piece of
equipment to operate with fewer parts. The answer to simplifying is teams. It is absolutely
necessary to establish teams and then management practices that favour group
accomplishment. The overall outputs require more skill and knowledge than any single
Page 42 of 42
individual or functional group can possess. Our HR systems must be aligned with the vision
and proactively provide training for everyone to facilitate the transformation to an empowered
culture. We must set each and every team up to win. This means training those who form and
participate in teams how to define roles and responsibilities, align the teams with deployed
objectives, and how to operate in an environment where many of the old rules of functional
management no longer apply.
The greatest gains will come from cross-functional integration of the company. It is essential
that the organizational structure eliminate barriers between staff thinkers and line doers,
between functions, and between the company and the outside world. We must eliminate walls.
Every toss over the wall adds cost and delays.
There has been much discussion about high overhead rates. How much of it is value added?
What is the work that really needs to happen? And how? And where? And by whom? Do our
customers really want to pay for all those progress reports we generate? Lasting changes to
the administrative cost structure require changes to the basic organizational structure. We
need to examine the work processes in place that cause the overhead in the first place.
Overhead activities are a symptom, not the disease.
Our lean implementation is centred on people. Lean requires partnering with all employees
and indeed our corporate values demand empowerment at all levels. We must go beyond the
trendy slogans and truly empower our employees to initiate change. It requires a new way of
approaching labour:
Old Concept New Concept

Top down decisions Empowerment
We/they (worker/mgmt) Partners
“Its not my job” Accepting responsibility
Individual effort Team work
Single skill Multi-skilled employee
On the job training Up front 40 hrs/employee
A team environment must dispel the old, “If you want to influence the direction of the
business, become a manager.” We must allow everyone to have a say. Employee
empowerment does not, however, abrogate management’s authority or responsibility.
Management maintains its obligation to provide leadership in this partnership to jointly
assume responsibility for success.
Empowerment requires a cultural change in our organization. It requires a four phase change
strategy: (1) Employees are provided the information necessary to become actively involved
in operations, (Training and information sharing), (2) employees are empowered and
motivated to assume their new, more active roles, (Teams), (3) management works with
employees to encourage their involvement, (Suggestions and recognition programs), and (4)
the kaizen philosophy is institutionalised and becomes part of the company culture,
(Continuous improvement). Motorola has been able to flatten its structure with empowerment
of the workforce and we can look at their scale to evaluate where we are:
Page 43 of 43
Supervisor
Centered Team
Centered
1 2 3 4 5 6 7
1 = Supervisor assigns all work. All support functions are external.

2 = Operators determine their own training needs, provide on-the-job training to
others.
3 = Supervisors present problem, asks for input. Operators take individual
responsibility for quality and productivity.
4 = Operators assume team ownership for departmental performance; employ team
problem solving and goal setting, track own progress.
5 = Work process is maximized. Team organizes its own work, interfaces with
other teams, vendors and customers. Team prepares and presents reports,
plans, and metrics.
6 = Teams are fluid, highly skilled, multi-functional. They take on administrative
work that was formerly done by supervisors with minimal management
oversight. Lines between exempt and non-exempt are diffuse.
7 = Team is now the entire business unit, focused on the customer. Structure is
flat and operates horizontally. Team is empowered to place responsibility and
decision-making authority where the work is being done. Management sets the
vision; team takes part in setting strategy, goals, tactics, and policies of
implementation.
Source: Motorola Corporation
They work closely with their empowered people and adhere to a set of beliefs:
1. Empowerment is a business-driven process, not a human relations program.
2. Empowerment must begin at the top and encompass the entire organization.
3. Empowerment is acceptable to employees because they want to take ownership
and become world-class producers.
4. Empowerment affects all functions, not just production-oriented ones.
5. It is not necessary to have a crisis before implementing empowerment; it can be
put into action at any time.
6. Empowerment is an evolutionary process that takes time, hard work, and a well
planned and executed strategy. If it is done right, it is an irreversible process.
4.1.6 Generating Short Term Wins

It is important to generate some short-term performance improvements that will be visible by
large numbers of people in the organization. Initial improvement projects for lean
implementation should be performed in areas where it is certain to be highly successful and
where the results will be clearly linked to the change effort. Generating short term wins:
• Provides evidence that sacrifices are worth it
• Reward change agents with a pat on the back
• Solidifies vision and strategy
• Undermines cynics and resisters
Page 44 of 44
• Keep bosses on board
• Builds momentum
• Places additional emphasis on metrics
The point is not to maximize short-term results at the expense of the future, it is to make sure
visible results lend credibility to the transformation effort and build momentum. It is
imperative that we deliver on merger synergies.
4.1.7 Consolidating Change and Producing More Change

Celebrating short-term wins is important in order to build momentum. We must be sure the
celebration doesn’t send a message that we are “done” with our plan. Short-term success does
not mean we can relax. Major change will take time in a large organization like Dyno Nobel.
The sense of urgency must not be lost:
• Regression is a constant risk - relentless leadership is essential
• Short term wins lack interdependent organizational linkages
• Longer term changes re-adjust interdependence and yield more pervasive change
• Requires creating a sense of urgency in new directions
• Highly interdependent changes require multiple change efforts to run simultaneously
4.1.8 Anchoring New Approaches in the Culture

This is the last stage in the process. This is where we declare that the new approach is now
part of our culture and put the old formula for success behind us. This step comes last, not
first, however. We can’t declare ourselves the lean enterprise before we demonstrate that this
is how we truly operate.
• Comes last, not first
• Both short and long term changes must have taken hold
• Dependent on positive results
• Must be very clear that the new approach works
• Requires massive verbal instruction and support
• A “eulogy” putting to rest the old norms must be delivered by a top executive
• Will eventually involve some turnover
• A last resort yes, but a very real one none the less
• Succession planning is crucial
• Promotions must embody the new norms
4.2 Change Leadership Summary

• Determining what to do is easier than doing it
• Leading change is a process in itself. It is management's most important responsibility
• Management must anticipate swings in morale and confidence, understand the process
and invest the time and energy required to stay the course
• Teams will be at different places on the curve at any point in time
Page 45 of 45
5 Creating the Change
Fujio Cho, former President of Toyota USA, likens an organization to the human body, in
that, when a change is attempted, the body generates “antibodies” which automatically grow
to fight the change
–And the stronger the organizational culture, the more “antibodies” it creates
So, we should expect some resistance and develop mitigation plans, or at least have a strategy
for how to handle them.
5.1 People's Expectations and Perceptions

What’s in it for me? Why should the individual adopt those new ideas? Selling the message to
load might also create impossible expectations, so how do we balance this?
During implementation of TQM as a ”managerial wave”, that can be seen as a somewhat

similar change as the Lean implementation, Martin45 noted that it had a lot more in common
with social work than have some past change programmes had and that its adaptation
therefore may be easier.
In other words, workers may have the view that management is only concerned about the
product, not the staff needs. Management initiatives focused on concerns such as budgets or
costs will not necessary resonate with the line workers. They might believe that their services
and products are already excellent and that there is not much more to be done. According to
Pruger and Miller46 there may actually be a lack of interest in efficiency or even effectiveness
and outcomes.
Workers have needs and concerns, such as less strain-full tasks and less bureaucracy, which
are different from those of administration. For the lean to work, employees must see that lean
helps them. Luckily, there are win – wins here. As lean is all about empowerment and
reduction of waste, the bureaucracy should be reduced to an absolute minimum.
5.2 Sources of Resistance

Implementation of large-scale changes such as Lean will inevitably face resistance, which
should be addressed directly by change agents. Also, management resistance to employee
empowerment is likely. They may see decision-making authority in zero sum terms; if
employees have more involvement in decision-making, managers will have less. In fact, one
principle in employee involvement is that each level will be more empowered, and managers
lose none of their fundamental authority. There will undoubtedly be changes in their roles,
however. As was noted above they will spend less time on control and more on facilitation.
Resistance in other parts of the organization will show up if Lean is introduced on a pilot
basis or only in particular programs (Hyde47 and Kanter48 ) has referred to this perspective as
45
Martin, L. (1993). ”Total Quality Management: The new Managerical Wava.” Administration in Social Work.
17(2), 115
46
Pruger R. and Miller L (1991) ”Efficiency,” Administration in Social Work. 15(1/2), 42
47
Hyde, A. (1992). "The Proverbs of Total Quality Management: Recharting the Path to Quality Improvement in
the Public Sector," Public Productivity and Management Review. 16(1), 2537.
Page 46 of 46
segmentalism: each unit or program sees itself as separate and unique, with nothing to learn
from others and no need to collaborate with them. This shows up in the "not invented here"
syndrome: those not involved in the initial development of an idea feel no ownership for it.
5.3 Dealing with Resistance

There are several tactics that can be helpful in dealing with resistance to the Lean
implementation. Generally, they have to do with acknowledging legitimate resistance and
changing tactics based on it, using effective leadership to enrol people in the vision of Lean,
and using employee participation.
At the Ensign Bickford Company, as at many others, they promised that no one would loose
their jobs due to the implementation of Lean. In starting with developing empowered teams
they managed to get the employees involved and in many cases actually manage some of the
changes.
A useful technique to systematically identify areas of resistance is a force field analysis, as

described by Brager & Holloway49 . Kurt Lewin originally developed this technique as an
assessment tool for organizational change. It involves creating a force field of driving forces,
which aid the change or make it more likely to occur, and restraining forces, which are points
of resistance or things getting in the way of change. Start by identifying the change goal, in
this case, implementation of Lean. Represent this by drawing a line down the middle of a
piece of paper. Slightly to its left, draw a parallel line that represents the current state of the
organization. The change process involves moving from the current state to the ideal future
state, an organization effectively using Lean. To the left of the second line (the current state),
list all forces (individuals, key groups, or conditions) that may assist in the implementation of
Lean. These may include environmental pressures leading to reduced funds, staff who may
like to be more involved in agency decision making, and the successful applications of Lean
elsewhere. On the other side, list restraining forces, which will make the change
implementation more difficult. Examples may be middle management fear of loss of control,
lack of time for line workers to take for change or empowerment meetings, and scepticism
based on the organization's poor track record regarding change. Arrows from both sides
touching the "current state" line represent the constellation of forces. Each force is then
assessed in two ways: its potency or strength, and its amenability to change. More potent
forces, especially restraining ones, will need greater attention. Those not amenable to change
will have to be counteracted by driving forces. An example can be seen in the table below;
A Force Field Analysis

DRIVING FORCES RESTRAINING FORCES
Environmental pressures leading to reduced
Middle management fear of loss of control
funds
Staff who may like to be more involved in Lack of time for line workers to take time for
agency decision making change or empowerment meetings
Scepticism based on the organization's poor
Successful applications of Lean elsewhere
performance regarding change
48
Kanter, R. (1983). The Change Masters. New York: Simon & Schuster.
49
Brager, G. & Holloway, S. (1992). "Assessing the Prospects for Organizational Change: The Uses of Force
Field Analysis." Administration in Social Work. 16(3/4), 1528
Page 47 of 47
The analysis of the force field involves looking at which driving forces may be strengthened
and which restraining forces may be eliminated, mitigated, or counteracted. If it appears that,
overall, driving forces are strong enough to move back restraining forces, adoption of Lean
would be worth pursuing. The change plan would include tactics designed to move the
relevant forces.
It is also important to note and validate any points of resistance which are, in fact, legitimate,
such as the limited amount of staff time available for change or empowerment or any needed
training meetings. Klein, cited in Bennis, Benne, & Chin50 , encouraged change agents to
validate the role of the "defender" of the status quo and respond to legitimate concerns raised.
This will allow appropriate adaptations of the Lean process to account for unique
organizational circumstances. Sell the changes (implementation of Lean principles) based on
the organization's real needs, note legitimate risks and negatives, and allow improvements in
your own procedures. We do not change just for the sake of change. This might in fact
enhance our credibility and show our openness to critically looking at the process.
Another way to address resistance is to get all employees on the same side, in alignment
towards the same goal. Bennis & Nanus 51 claim that leadership is the mechanism for this, and
specific models known as transformational or visionary leadership are most effective.
Research on change implementation (ref. Nutt, cited in Robey52 ) has identified four methods.
The first, "intervention," involves a key executive justifying the need for change, monitoring
the process, defining acceptable performance, and demonstrating how improvements can be
made. This was found to be more successful than "participation," in which representatives of
different interest groups determine the features of the change. Participation was found to be
more successful than "persuasion" (experts attempting to sell changes they have devised) or
"edict," the least successful. Transformational or visionary leadership, the approach suggested
here, is an example of the intervention approach. This would involve a leader articulating a
compelling vision of an ideal organization and how Lean would help the vision to be
actualised. Again, we se the need for a strong, respected and perhaps charismatic, leader.
Empowerment or in other words, employee involvement, is crucial. A powerful way to

decrease resistance to change is to increase the participation of employees in making
decisions about various aspects of the process. From Packard53 we learn that there are actually
two rationales for employee participation;
• The more common reason is to increase employee commitment to the resultant
outcomes, as they will feel a greater stake or sense of ownership in what is decided.
• A second rationale is that employees have a great deal of knowledge and skill relevant
to the issue at hand (in this case, increasing quality, identifying problems, and
improving work processes), and their input should lead to higher quality decisions.
50
Bennis, W., Benne, K, & Chin, R., Eds. (1985). The Planning of Change. 4th Ed., New York: Holt, Rinehart, &
Winston, 98105.
51
Bennis, W. & Nanus, B. (1985). Leaders. New York: Harper & Row
52
Robey, D. (1991). Designing Organizations 3rd ed., Homewood, IL: Irwin, p. 42.
53
Packard, T. (1989). Participation in decision making, Performance, and job satisfaction in a social work
bureaucracy. Administration in Social Work. 13(1), 5973.
Page 48 of 48
Also, (Vroom and Yetton54 ), a manager should consider any decision area as a possibility for
employee participation, with the understanding that participation is not always appropriate.
Employees or their representatives may be involved in decision areas ranging from the scope
and overall approach of the Lean principles to teams engaging in quality analysis (Six Sigma
is often combined with the implementation of Lean) and suggestions for improvements. They
may also be involved in ancillary areas such as redesign of the organization's structure,
information system, or reward system. Involvement of formal employee groups such as
unions is a special consideration, which may also greatly aid the implementation of Lean.
According to Beckhard and Harris 55 overall, change will occur when three factors
(dissatisfaction with the status quo, desirability of the proposed change, the practicality of the
change) added together are greater than the "cost" of changing (time spent in learning,
adapting new roles and procedures, etc.). Considering this, implementing tools as 5S, where
everybody involved agrees that this will improve of safety, efficiency and even create a more
pleasant working environment and that the costs and efforts are very limited, often is very
hard and difficult. My personal experience here is that people is also lazy. They want
someone els to come and fix things.
Any key group or individual will need a level of dissatisfaction with the status quo, must see a
desired improved state, and must believe that the change will have minimal disruption. In
other words, the change must be seen as responding to real problems and worth the effort or
cost in getting there. It might be possible to modify these variables to create conditions that
favour change. The change agent may try to demonstrate how bad things are, or amplify
others' feelings of dissatisfaction; and then present a picture of how Lean or any other change
in question could solve current problems. The final step is to convince people that the change
process, while it will take time and effort, will not be prohibitively onerous. The organization
as a whole and each person will be judging the prospect of Lean from this perspective. A
variation of this is the WIIFM principle: "What's in it for me?" To embrace Lean, individuals
must be shown how it will be worth it for them.
A final possible area of resistance, as I’ve experienced in my own work, is the "not invented
here" syndrome may be seen after Lean, or at least some parts of this large change, is
successfully adopted in one part of the organization and attempts are made to diffuse it, or
spread it to other areas. Such resistance may be prevented or reduced in three ways. First, the
general techniques mentioned above should be helpful. Second, each new area (program,
division, department) should have a new assessment and contracting process: different
circumstances should be expected in each part of the organization. Finally, a general principle
of Lean implementation mentioned below is relevant here: every Lean application should be
uniquely adapted: don't use "off the shelf" models or try to standardize all aspects of the
process.
54
Vroom, V. and Yetton, P. (1973). Leadership and Decision Making. Pittsburgh: University of Pittsburgh
Press.
55
Beckhard, R. & Harris, (1987). Organizational Transitions: Managing Complex Change. (2nd ed.) Reading,
MA: AddisonWesley.
Page 49 of 49
5.4 Current Reality and Preconditions
An organization should be basically healthy before beginning implementing the principles of
Lean. If it has significant problems such as a very unstable funding base, weak administrative
systems, lack of managerial skill, or poor employee morale, Lean would not be appropriate.
However, a certain level of stress is probably desirable to initiate the change: people need to
feel a need for a change. Kanter56 addresses this phenomenon be describing building blocks
that are present in effective organizational change.
A mentioned earlier, a crisis, if it is not too disabling, can also help create a sense of urgency
that can mobilize people to act. In the case of Lean, this may be a funding cut or threat, or
demands from consumers or other stakeholders for improved quality of service. After a crisis,
a leader may intervene strategically by articulating a new vision of the future to help the
organization deal with it. A plan to implement Lean may be such a strategic decision. A crisis
was also identified by Kanter as a driving force for change. Next, Osborne and Gaebler57
noted the importance of leadership. Such leaders are usually at the executive level of the
organization, where they can champion new ideas and protect risk takers. Employees or their
representatives (i.e., unions) must be involved early, particularly in addressing employee
training and recognition and employee empowerment and teamwork issues.
5.5 Steps in Managing the Transition

As so many before them, Cohen and Brand (1993) and Hyde (1992) assert that management
must be heavily involved as leaders rather than relying on a separate staff person or function
to shepherd the effort. An organization wide steering committee to oversee the effort may be
appropriate.
Beckhard and Pritchard (1992) have outlined the basic steps in managing a transition to a new
system such as Lean: identifying tasks to be done, creating necessary management structures,
developing strategies for building commitment, designing mechanisms to communicate the
change, and assigning resources. So, perhaps combining this with Demnings PDCA wheel
will do the trick, Plan, Do, Check, Act?
To be able to use Demnings PDCA wheel, we need a plan and some measurable results. We
need to build analysis into the change work. According to Cohen and Brand we should insist
on objective measures of results. Look for visible improvement, but not optimisation; and try
to generate some quick results in terms of time or money saved. Constantly check with
employees to assess their comfort with the process. If people are feeling threatened, slow
down. Human resources aspects such as team functioning and analysis must be kept in
balance.
6 Empirics
To validate, at least some of the theories the plan is based upon, I have been able to run some
“real life” experiments. That is, prior to rolling out the plan I had an opportunity to start off in
limited areas within the company.
There are multiple reasons for choosing to do this.
56
57
Osborne, D. & Gaebler, T. (1992). Reinventing Government. Reading, MA: AddisonWesley
Page 50 of 50
• In case of failure, the damage will be limited and the methods can be adjusted before
rolling them out through out the company
• In case of success, I would have something to show for to help persuade the next
group up for change
• With limited resources, this way of starting the implementation felt more controllable.
I would not be dependent on other facilitators to do the work.
• I would get a first impression and the possibility of measuring the results in first hand
I chose to start at the initiation plant in Gyttorp, some 40 km north of Örebro. Here some
of the principles of the Toyota Production System were already in use. Empowerment by
having the workers organised in “independent” groups had been implemented 10 years
ago (there where no foremen or middle management at the plant). Due to this the staff
were used to work in teams and to make decisions. Through this they were also very
engaged in their work.
6.1 Case studies

6.1.1 5S at the Gyttorp IS Plant
The Gyttorp plant is a production plant for initiation systems for the commercial
explosives industry. That is, they produce detonators used to initiate explosives as used in
quarries, mines, tunnelling, etc. The old name for the plant, Nitro Nobel, was Alfred
Nobel’s first company and the second location for producing explosives after Vinterviken.
Needless to say, the employees here are very proud of their history and of the company
where they work. This is also the centre for Dyno Nobel Sweden AB.
The first Lean tool or method to be introduced was 5S. This is to help people create order
and discipline, something we need to have in place in order to improve the business
further on. Even though implementing 5S might seem a very limited change, I wanted to
do this properly and by the “plan”. However, during the winter we had involved all
employees in developing and updating the Values, Vision and Strategy for the company.
This way also the Change Vision (turning Lean) was communicated. This meant the plan
could not be followed in chronological order.
My knowledge about 5S came from input from companies visited in Sweden as well as
from my US colleagues. According the colleagues in the US the best way to go ahead
would be to bring in a group of external “experts” and then perform all changes in a day
or three and not leave the premises until at least the first three S’s had been
“implemented”. From companies visited in Sweden I learned this could be achieved just
as well in a less “brutal” way by first explaining to all employees involved how 5S work
and then more or less leave it to them to plan and perform the changes themselves. In
Gyttorp we chose to follow this last path.
6.1.1.1 H-267
The number of employees in H-267 is 21 in total. This area was selected to be the “guinea
pig” for the Lean implementation. H-267 is the electric initiator assembly house, an area
that has experienced continuous down seizing the last 10 years, as the market for electric
detonators is decreasing. Due to this, H-267 has not had any particular attention from
management, nor has it been prioritised regarding investments in new machinery etc. Still,
Page 51 of 51
this is a fairly highly automated production site. The employees have a relatively high
degree of empowerment, as there is no foremen, they themselves, among other
administrative task, handle procurements, production planning, etc.
Creating a sense of urgency

This was not particularly difficult, as the manufacturing costs in H-267 had not improved
in many years, as it had in the non-electric assembly house. Compared to the rest of the
Gyttorp plant, H-267 might be considered “over staffed”. Both the manager and the staff
felt an urge to improve.
Creating the Guiding Coalition, Communicating the Change Vision and empowering
the employees.
What we did was to collect all the employees (only day shifts in H-267) in the canteen and
inform about Lean in general and 5S in particular (see appendix 1) and some thoughts we
(the local manager and I) had on how to go ahead.
We started by closing H-267 for one day, January 22, 2004, and travel a few hours to visit
another plant that just had implemented 5S, Finnboden in Trollhättan, to see and learn.
We had meetings with both management and the unions there. Then we had two
consultants from JMAC Scandinavia inform about the implementation of 5S and Lean at
both Finnboden and SAAB in Trollhättan. At the bus-tour back in the evening the
employees expressed their enthusiasm and by themselves started planning how to
implement 5S. They started by selecting 5 operators among them that should have the
over-all responsibility for following up on 5S and to manage the work to be done, one
area each. This group of 5 should then plan and lead the implementation in detail.
Within a few days the team called everybody in the department for a meeting and
presented a relatively detailed layout showing the individual responsibility and a schedule
for change. The plan was agreed on and the work started. See more details this and 5S in
appendix 2 and 2b.
Creating short term wins

Besides a generally more pleasant work environment with order and tidiness, some there
was a satisfactory reduction in working capital. The total lead-time for the products made
was also reduced.
Consolidating change and producing more change

After the experience of lead-time reductions the team now realized there were more
improvements to be made. A full value stream mapping was conducted and new
improvement possibilities highlighted.
Continuous improvements have now become a natural way of thinking in H-267.

Recently (summer 2006) the company decided to close down a factory in Germany
producing electric detonators and transfer this activity to H-267 resulting in a tipple of the
volumes to be produced here. The staffs in H-267 are very satisfied with the development
and eager to continue improving on their value stream.
Page 52 of 52
A Value Stream Map of the electric detonator assembly.
The 5S bulletin board created by the staff in H-267 showing pictures before and after 5S, as well as the
different steps in implementing, responsibility areas – persons and results from inspections.
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The pictures show trays for isolated wire used in electric

detonators. There is a limited amount of trays and all are marked
with the actual colour (indicating impedance). The truck driver
will pick up the empty trays, transport them to the wire
production house who will manufacture and fill them with
correct wire. This way we secure there will not be produced too
large amounts of wire and we keep the inventory under control.
Also this works as a simple Kanban system eliminating the need
for ordering and planning.
6.1.1.2 5S in H-2100 Tube Plant

From the positive experience from H-267 starting to implement 5S in H-2100, the Tube
Plant for production of the tube for non-electric detonators was chosen next. The tube is
used to transfer a detonation front from a initiation machine to the detonator in a non-
electric initiation system. This is very difficult and challenging process that is crucial for
the plant. This part of the plant can be considered somewhere in the middle of the value
chain, supplying the Nonel assembly plant next door as well as many other assembly
plants around the world. In this area there is production 24 h a day 7 days a week, in a 5-
shift arrangement. The volumes in H-2100 are constantly increasing, the machinery used
is state of the art and the work environment is very positive, however introducing change
in a 5-shift environment is very difficult as the information flow between shifts are
challenging.

This was very difficult as everybody in this are seemed very confident and had a very
optimistic view of the future. Still all the employees in H-2100 had seen the change in H-
267 and were positive towards 5S and could recognize the benefits. We had a tour through
the plant with the operators and had them comment on possible improvements regarding
order and tidiness, and this seemed to really motivate them as the discovered a lot of stuff
that did not really belong. Some pictures from the tour are shown below:
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The pictures show a lot of stuff not in its right place.
Way to much inventory and not very organized.
the employees.
As with H-267, we collected all the employees (due to the 5 shifts this had to be done 3
times in one day) in the canteen and inform about Lean in general and 5S in particular
(see appendix 1) and some thoughts we (the local manager and I) had on how to go ahead.
The workload in H-2100 was very high and closing down for visiting other companies
was out of the question. Prior to the meeting all, or at least most of the staff had visited H-
267 to get an idea of what 5S and Lean was about. The staffs in H-2100 seems to be very
focused on results and at this first meeting agreed on 1 man from each shift to be in charge
of the 5S implementation.
Page 55 of 55
Within a few days the team called everybody in his or her respective shift for a meeting
and presented a relatively detailed layout showing the individual responsibility and a
schedule for change, as shown below. The plan was agreed on and the work started.
Grupp 1 5S -områden Ansvariga Språkrör

Plastgranulatlager Christer Skager Joakim Franck
Lastkaj Joakim Franck
Hus 103 Bo Stark
Mikael Holm
Christian Hjortsberg

Rum för upptagarna och Tommy Israelsson Anders Johnsson
färdig slanglager Anders Johnsson
Anders Engvall
Mikael Nohlgren
Leif Andersson

Stora produktionsrummet Reijo Sällinen Jonas Vestberg
Jonas Vestberg
Fredrik Cederborg
Ove Dahlin
Lars-Åke Pettersson

Doseringsrum Fredrik Wiberg Peter Jansson
Sprängämnesbunkrar Peter Jansson
Göran Lindell
Bertil Ekestubbe
Gemensamma 5S -områden Ansvariga Språkrör

Mätrum Alla har delat ansvar Alla språkrör
Laborationsrum
Verkstad
Städ och WC

Due to the challenges with communication between shifts, the implementation and the
progress was fairly slow compared to H-267, still a generally more pleasant work
environment with order and tidiness, and also here we achieved a satisfactory reduction in
working capital by reduction of inventory. The total lead-time for the products made was
also reduced. This time we also remembered to take photos of the area before and after the
change to document the visual changes performed.
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Everything is in its right place, no need to spend time looking for a missing tool, document, etc.
Inventory have been reduced and floor space have been freed up.

Even though the visual changes were significant and also some man-hours were freed up
due to some small improvements in internal logistics in the department we faced a
problem keeping the pressure up. We performed Value Stream Mapping also in the Tube
Plant to highlight possible improvements, as shown below.
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Prod Plan
Boralis 2,4 w Nonel
PE
23 t
Export Vecko plan

H2100A
1 w 4.)
Dow
mellanlager 3w
PE
23 t Slang tillverkning
3.)
Speed 320 m/min
Uptime 75 % Plock
DuPont 0,9 w lager
L/T pr 7000 m 21 min
Surlyn
11 t S/T Typ 3 h
Export
S/T Färg 30 min
HMX/Al Uppstart 3 t
2 w
H297 Scrap 7 %
1.)
DNAP
21 Days 7 Days
21 min
2.)
Kaizen
1.) Utvärdera säkerhetslager

2.) Container - hur skall vi göra? Direktkontakt Prod - Kund
3.) Pågår! Reliable Extrusion Line Project (350 m/min)
4.) Utvärdera om vi kan ta bort en sektion med 7km spolar
6.1.1.3 5S in H-268
After the experiences with H-267 and H-2100 with 21 and 20 employees respectively, I
decided H-268 with its 7 employees was nest. I considered this area to become a sure win
as to most people this department had some obvious improvement possibilities regarding
tidiness and order. There were also tons of complaints from other departments regarding
quality and delivery punctuality from H-267 as this department were in the very beginning
of the whole plants value chain. Here they manufacture aluminium shells for the detonator
production further down the value chain as well as aluminium tubes for the delay
elements. There is no handling of explosives in this department. In H-168, as in H-267
they work daytime only so no communication problems between shifts. In H-268, all
employees had visited H-267 and had an idea of what 5S and Lean was about. To my
surprise though, not all of them had a positive attitude towards 5S.

In H-168 we had for a relatively long time suffered from problems supplying materials
downstream. One might also say the job satisfaction was not the best. I had a feeling the
employees here were a bit sensitive and considered all suggestions for change as criticism.
However, at least a few of them were willing to give 5S a shot and we managed to agree
to go on.
the employees.
As with H-267, we collected all the employees in the canteen to inform about Lean in
general and 5S in particular (see appendix 1) and some thoughts I had on how to go ahead.
Page 58 of 58
The workload in H-267 was moderately high, however closing down for visiting other
companies was also here out of the question.
As in the two previous areas, the team called everybody in for a meeting and presented a
relatively detailed layout showing the individual responsibility and a schedule for change.
5S -områden Ansvariga
Hylsdragningsmaskiner + Tomas Haag
reservdelsskåp + Thomas Multanen
Anslagstavlorna
Elementdragningsmaskiner + Bernt Rutgersson
reservdelskåp Anders Lundkvist
Kjell Sundström
Tvätten + Seppo Hoikala
Hylsmärkningsmaskinerna + Jan-Olov Persson
oljeförråd
Gemensamma 5S -områden Ansvariga

Omklädningsrum Alla har delat ansvar
Kontrollrum
Pausrum
Ej färdiga produkter, råmaterial
Färdiga produkter
Skräp
Svarv
Getting everybody involved can be a challenge

Due to different opinions on what to prioritise, if this really was such a good idea, etc.,
etc. the implementation and the progress was fairly slow compared to H-267. After doing
a Value Stream Map and discussing the importance of continuous improvements, some
ideas that were presented really showed some very promising results. Some of witch
Page 59 of 59
turned into projects and some just ordinary Kaizens. The amount of inventory and by that
also the total lead-time for the products made was reduced significantly. The production
was meant to be by order, however due to relatively long change over times (another
project has been started to reduce those) the staff normally would just bin the production
orders and rather run very long production series for storage and then just deliver what
was needed from the storage. This time we also remembered to take photos of the area
before and after the change to document the visual changes performed.

Even though both the visual changes and reduction in inventory were we faced a problem
winning all employees over. However the resistance from one or two employees can
destroy what we are trying to accomplish and I could just not give in. It was then decided
to implement TPM in the area, to improve on machine up time, reduce change over time
and to get an environment of continuous improvements implemented. This project will not
be referred here though.
Step 1, Sort. Removing what is not needed. Before and after.
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Step 2, Systemize. Everything in its own place. Keeping order and discipline – improved work environment.
Step 3, Shine. The hole work area need to be cleaned up, including all “new” space.
The 5 S and the continuous improvement boards from the TPM project.
6.1.1.4 5S conclusion from the Gyttorp Plant

First of all through a company wide employee involvement in developing or at least
revising the company vision and values just prior to implementing Lean and where Lean
was highlighted as the way forward, a lot was already achieved regarding the
implementation as everybody should at least now had heard about the Lean philosophy.
Some expectations had been created and most employees were curious about Lean.
Except from the obvious benefits from 5S itself, as improved order and tidiness with less
time spent on looking for stuff, reduced inventory and by that reduced working capital
bounded up, and above all, better disciple towards rules and regulations, we gained some
experience in how to go about when implementing those changes. First when we started in
Page 61 of 61
H-267 we gained a lot of momentum just by giving people some well-deserved attention.
Through this start where we visited a different company the staff became positive and
wanted this to work. They had actually bought in to the idea and worked also as
ambassadors promoting Lean among the rest of the employees. I think this was a very
important contribution to the success we gained.
When we continued introducing Lean and 5S in new areas people had heard positively
about it, still there might have been some envy as the employees in H-267 were allowed to
spend time and money visiting other companies, etc. However, after the success in H-268,
which was very difficult, the rest of the Plant should be able to see the benefits and
assumable 5S can be implemented with hardly any resistance.
As a bi-effect from 5S we also managed to improve on safety as we ended up using the

safety deputies to evaluate also the 5S standard as part of their safety and fire-prevention
evaluations. Through this change the safety deputies gain increased status and respect
which we at Dyno consider important for safety.
6.1.2 Standard Work Event in H-2100

The Nonel assembly plant, as the name indicates, the Nonel system is produced. This
plant is in the very end of the value chain in the plant. The area handles very large
volumes and is critical for the profitability for the Gyttorp Plant. Approx. of the volumes
are manufactured against customer orders, the remaining scheduled to meet identified
stock levels. The operators do themselves handle the production planning, procurements
and handling of orders, etc. A very high degree of empowerment is already in place.
In the Nonel assembly plant there are approx. 60 operators working on three shifts, each
shift six hours. This special arrangement was agreed with the unions as a long-term test
some years back. The workforce has proved they can produce very effective over the 18
hours available per day. This has been a very popular arrangement among the workers and
they work very hard for those six hours with hardly any breaks.
In 2003 the plant suffered from capacity problems regarding Nonel detonators with long
Nonel Långledare - Trend Volymutveckling
2500
2000 12-24m
27-30m
1500
k units
12-30m
Poly. (12-24m)
1000
Poly. (27-30m)
500 Poly. (12-30m)
0
2000 2001 2002 2003 2004
Page 62 of 62
leads. The trend, as well as the budget indicated even higher volumes for 2004.
At the plant only one of the machines could be set up to produce this specific product. The
machine was actually producing this product all the time, on all shifts. Increasing the
working hours was not a popular option, and also would be very difficult due to
legislation and union agreements as described above.
To solve the problem the local management at the Gyttorp Plant had requested for capital
to invest in a new similar machine to increase capacity. The cost of such a machine was
estimated to approx. one million US Dollars. 2 operators are required to run the machine,
at each shift.

The granting manager (sitting in the US) required a “Standard Work Event” to be run
prior to any granting of capital for investment. The hidden message people heard were;
you a working 18h in 3 shifts, I can hardly see the need for more investments, you just
need work longer hours.
The wording in the term “Standard Work” had a negative meaning in it for most of the
employees involved, giving associations towards the outmoded, antiquated, time studying
consultants trying to make the workforce work ever harder. One might say a sense of
urgency was present, as the volumes needed could not be reached, however there were
also a negative atmosphere present among the involved towards the event to be run.
the employees, i.e. running the event.
We collected all the employees (due to the 3 shifts this had to be done 3 times in one day)
in the canteen and informed about the event to be run and the meaning of the term
“Standard Work”.
Whatever negative feeling present, the staffs in H-2100 seems to be very focused on
results and at this first meeting agreed on whom to participate from the work force in the
event.
Participating in the event was a very good mixture of management, production personnel,
maintenance, engineering, the company’s ergonomic consultant, production planning,
SHE, and the teaming coordinator. Members included Stig Nyqist (Team Leader), Jerry
Hurum (Facilitator), Tim Suydam(“Consultant”), Riitta JylhäWinter, Hans Olsson,
Margareta Borgsten, Solbritt Hjortsberg, Jens Larsson, Stefan Wallenstein, Carloline
Wilberg, Susanne Zaring, Görgen Funke, Kjell Frank, Torbjörn Lundborg, Torbjörn
Widström, and Kenneth Herrmansson.
The objective of the event was to increase capacity on the Nora 5 automatic Nonel
assembly machine.
Machine/demand data were as follows:

Projected demand (summertime) = 12,000 per day, which equates to a takt-time of 4.66
seconds. The Nora 5 is the only machine of its type (no other automated machine can run
the same product). Two families of products are run on the machine. 75% of production is
1.1B, and the balance is 1.4B/S, which is the same product, packaged differently. The
Page 63 of 63
takt time used for the event is based on the total volume through the machine, even though
the packaging of 1.4 is a slower operation. In the current state, the automated machine is
slowed down to compensate for the extra operator packaging cycle time. Orders are “set
up” in the next room. Approximately 60% of production is scheduled as a direct result of
a customer order and the remainder is scheduled to meet DNE identified stock levels.
Customer order numbers are referenced on a bag label (for foil bagged product) and on the
box (on two adjacent sides). The foil bags are labelled on an automated machine in the set
up area. Labels are printed for the order. Boxes are assembled to the requirements of the
production area; approximately 7 carts maximum will be built up at any one time (70
cartons +/-). When an operator starts an order, they will come to the set up area, pick up
labels and bags (if foil) off a shelf. Operators take one cart of boxes at a time, and finished
goods are loaded onto the same cart that the cartons were removed from. There is only
one cart (total) in each operator’s area. One operator runs an automatic machine, with
occasional assistance from a maintenance person, who may change spools, etc. The
assembly department runs 18 hours per day, 3 shifts (6 hour shifts).
Machine and demand data as presented by the Team.
The event commenced with standard work training and the practical exercise. This
training was the training package typically used in other parts of the company where Lean
production has been implemented, as in Simsbury and other US sites. To ease the situation
for the participants all material was translated into Swedish.
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Standard Work training session.
Following the training, actual time observations were done in the focus area. In addition to
timing the process itself, times and distances (where applicable) were taken for related
activities, such as tube spool changeover, end of order, set up of order, full product
changeover, removing FG from the operation, and moving cartons to the area. While
doing the timing, a layout was done using a CAD drawing (rather than a Standard Work
Sheet). Added to the drawing were areas that inventory existed, distances, etc. Also during
the data collection stage, comments were documented concerning quality concerns, etc,
the most notable being the very high level of scrap that the foil bag label machine was
generating (scrapped unit count was close to 8% during a brief observation).
Time observations, distance measuring, etc during the event.
The time observations indicated that (for 1.1B product) that Takt-time (4.66 seconds) is
extremely close to the cycle time of the machine (4.6 seconds). Per the Gyttorp
engineering group, 4.6 seconds is the top speed of the machine. Discussions had been
conducted in the past as to the feasibility of speeding up the constraints within the
machine, but it was deemed not possible, due to timing issues, etc. As noted earlier, the
machine speed for the 1.4B/S material is longer (5.6 seconds), but this is not a machine
constraint (the product is the same), but it has been slowed down to match the speed of the
packaging operation (to keep from starting and stopping the machine all the time).

It became quite clear when this time observation data was analysed that the greatest
opportunity for increasing capacity was not so much related to the speed of the machine or
the operator, but eliminating waste in the process which causes the machines to sit idle.
The primary waste is related to the out-of-cycle tasks that are performed by the operator,
Page 65 of 65
including moving finished goods out and empty boxes in, changing tube spools, ending an
order, starting an order, and full changeovers, but also includes unplanned downtime, such
as jams, etc. An additional waste is the slowing down of the machine to match the pace of
the operator. The time taken away from manufacturing for these tasks accounts for 35% of
the available time (or 30%, if only out of cycle tasks are considered). Below is a listing of
the most significant opportunities:
Activity Minutes per day (18 hours)

1. Changeover 17.5 min
2. Moving Finished Goods to shipping area 7.5 min
3. Starting an order 6.5 min
4. Finishing an order 15 min
5. Moving Cartons to the machine 40 min
6. Changing tube spools 30 min
7. Operator stopped the machine* 180 min
8. Misc stoppages (i.e. need raw material) 30 min
Total 326.5 min
(Total Available Time 932 min/55,920 sec)
*40 of the 180 minutes is related to the slowing down of the Nora 5 for 1.4B/S product to
match the speed of the operator.
Outputs of the event included:

o Modifications were made to the automated labeller. The labeller was fitted with
brushes to separate the bags, and a stronger vacuum to improve the lifting and moving.
Although the modifications were still considered to be under trial, no further problems
were being experienced.
o Teams and team leaders were assigned to take on each of the activities listed in the
table above.
Calculating possible improvements, all done by the involved operators.
The team summarized the stages of the event on overheads and flip chart pages and this
information were to be presented to the all shifts of the workforce first coming Monday.
Page 66 of 66
Due to consensus management style, the team members chose to delay activities relative
to reducing the wasted minutes associated with the items in the table above until after the
Monday meetings. Ideas that were brought up during some brainstorming included re-
instituting a team based changeover process, including creating standard work and
documentation and posting of changeover time. Other solutions may require engineering
assistance. It was also noted that any changes made to the Nora 5 would be carried over to
the other machines, if applicable. The target time expected to identify and implement
solutions is 4-6 weeks.
Identified and agreed improvements to implement and assigning responsibility.

The identified improvements (change in std. work), agreed to implement ASAP,
summarizes to 1000 ea. pr day when running 1.1B products. In addition, some technical
changes were suggested, expected to give improvements that will reduce the cycle time
for 1.4 S/B to 1.1B level (without increasing manning). Two teams were formed to deal
with those.
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The Team agreed to arrange a second Kaizen event in 6 – 8 weeks to verify the outcome
from the changes and for planning new ones (PDCA).
Conclusion
After the event all involved gave an impression of being very positive towards the method
and showed great believe in the results.
Statement from the Site Manager, Gunnar Ekman, after the event: Fantastic improvements
have been achieved, however we still need more capacity and the goal is not achieved. We
still need approx. 30% more capacity and we have identified two ways to achieve this:
Either we need to invest in a new machine or we need to increase the production time, in
other words we need 24 h operation.
History show the improvements did actually work and they were also implemented
around the rest of the Nora machines. Actually, one year later, the customer demand was
met with more than 12000 units produced pr day without investing in a new machine, nor
increasing the production time. The staff had been increased with two operators per shift,
covering all the Nora machines, not only the Nora 5 in question here.
All in all this was perhaps the first time the Lean methods really did show its efficiency.
Even though 5S gave positive results, those could easily be measured as capacity
improvements and cost avoidance. And, not least important, the site manager, even though
he has been very supportive towards lean before is now a sworn believer.
6.1.3 Mistake proofing Kaizen

Mistake proofing (poke yoke) is a powerful weapon against waste by eliminating errors
that cause defects in the products we make. Mistake proofing starts with the understanding
that human errors are inevitable but that these errors can be eliminated. The discovery of
errors at the source, before they become defects, is the key to success. There is more
information about Mistake Proofing in appendix 1.
H-280
In this area they perform three main operations, they glue cardboard boxes, pack caps
(semi finished products for assembly plants abroad) and they also manufacture caps
(manually), mainly as a back-up capacity for the automated production houses.
When packing and shipping caps (and other explosives products) accuracy is very
important. In some places in the world missing products are per definition stolen (by
terrorists) and thorough investigation is required. Packing errors can in other words create
a lot of frustrated and annoyed customers.
Missing caps in 1.4S shipments

A mistake proofing Kaizen event was held in the Gyttorp IS Plant on December 2, 2004
due to customer complaints regarding missing caps in 1.4S shipments.
Participating
Gunnar Ekman (Site Manager), Thomas Brandel, Riitta J-Winther, Johnny Olsson, Lotta
Boström, Gunn Skoglund, Tina Andersson. Facilitating; Gunilla Pettersson and Jerry
Hurum.
Page 68 of 68
Background
Caps for the Australian market are 1.4S packaged (air freight) in House 280. Since
October 1 until today we have had 5 reported incidents of missing caps during the
unloading of airfreight MS detonators. This rate of error is totally unacceptable and we
need to eliminate the causes of error.
STÄNDIGA FÖRBÄTTRINGAR
Defects and errors
Everyone had a good understanding of the problem and the defect was defined as; missing
caps in the 1.4S packaged shipments.
The Team then went through the current standard procedures of the operation where the
defect was made, the total packaging process. Using the “5 why’s” methodology, the team
began identifying errors or deviations and investigated the causes for each error or
deviation.
The packaging process:

Caps are fed into a cassette-loading machine. After the loading machine the loaded
cassettes are transported through a safety wall onto a packing table. Here the cassettes are
(at station one) loaded onto a plastic tray, then (at station two) a plastic lid (identical to the
tray) is put on top, then (at station three) the caps are put into a bag that are vacuum
sealed. At the next station the caps are put into the cardboard boxes.
The causes of error were identified as;

1. The machine loading the 1.4S cassettes misses a cap at a frequency of 2 – 4 caps per
shift.
2. For the caps to still be missing at the arrival, the operator putting the cassettes onto the
tray does not spot this.
The next step in the process was to brainstorm ideas using the 3 different levels of a
Mistake Proofing device.
Level 1 – is to eliminate the cause of the error at the source,
level 2 – is to detect the error as it is and
level 3 – is to detect the error before it reaches the next operation. The team spent some
time discussing this, even though this had been a discussion theme for some time.
Page 69 of 69
Proposal
1.Cap counter is already installed on the machine. This should prevent any cassettes with
missing caps from arriving at the packing table. Done.
2. Improved illumination, to increase the ability for the operators to spot any missing caps.
Done by end of day.
3. The tray should have the short side towards the operator. It is easier to see if a detonator is
missing. Implemented.
Page 70 of 70
4. There shall be two operators at the packing table (there has been one from time to time),
one for the tray-end and one for the plastic bag. Both will check the numbers of detonators.
Implemented.
5. With a deadline at January 3, a second cassette-loading machine shall be installed. This will
eliminate (at least decrease) the need for manual cassette loading. Today the operator
manually loading cassettes also has to look after the cassette-loading machine. The Team
assumes this can cause the operator to loose some focus when loading cassettes.
6. The operators participating in the mistake-proofing event will evaluate the possibility of
personal marking of each tray with the rest of the empowered Team, taking personal
responsibility for the packaging as this would help tracing any future faults. Deadline next
Friday, Dec. 10.
Page 71 of 71
Conclusion of the Mistake Proofing Event

Perhaps not initially intended in the case of the event, however as a result some “waste”
processes were discovered. As a result the staff in the house managed to “free” up one
operator in the line from pressing to packing. This operator could then assist in the stressed
packing process and by so help reduce the number of mistakes.
These shows that by focusing on elimination of processes not creating value for the customer
we can initiate changes like this. Forcing such a change on the work force would not likely
have been very successful.
6.1.4 Lean in administrative processes

In a Lean Enterprise not only production need to embrace the Lean Philosophy, also the
administration need to do so. As a final test before presenting the final plan for change to
the top management I wanted to see how this could be used also in the office
environment.
It might be worth mentioning that at Dyno Nobel we implemented SAP in 2002. This has
simplified reporting and financial analysis. There are however still people around the
organisation that blame SAP for a lot of problems, one being that ordering and receiving
goods are very time consuming for the people at the shop floor actually doing this.
What we did was to invite the financial group at Dyno Nobel Sweden AB to learn about
Lean. After a presentation and some exercises (part of our training material) we had a
short brain storming session to find a theme or a case to start with. We ended up with an
agreement to look at the process of handling of invoices received.
6.1.4.1 Handling of invoices received – Administrative Kaizen

The participants of the first administrative kaizen, May 2005:
Participants from economy, IS/IT, production and HR
Currently the process of receiving vendor invoices, registering the invoices, distribute the
invoices, approval of the invoices and archiving the invoices in DNE is labour intensive and
cumbersome.
Some key figures:
Page 72 of 72
Norway Sweden HQ Total
Number of invoices in DNE/ approx.):
Manual invoices and credit memos 11.000 11.000 2.000 24.000
Invoice based on MIRO or
“Goods receipt” 4.000 7.500 11.500
Number of cost centre responsible: 50 60 20 130
The current situation was analysed. Below are a few maps from the event showing the
processes and in the value stream map draw also some suggestions for improvements are
shown.
Nulägeskarta över direkta

fakturor 040914
Betala på Bokning
rätt dato
Kvitto
Ek-avd L/T 10 s = 0.17 min
1 ggr/dag
Postgiro Bankgiro
Leverantör
Identifierade kaizen
1. Säkerställ att alla fakturor hamnar hos ek. avd
2. Ta bort orsaken till påminnelser - ta bort processen
3. Se över attesteringsprocessen - behövs den?
E-faktura, software/hardware
Skapa
betalningsfil
Inköpsreglementet
BH / LE Fraktfakturor Arkivsök
Kontrollera bankkonto
Erik / A.Sjörud Generera fil
L/T 0,5 min
Görs 25 / vecka
Beställare
1 ggr/dag
1. av tjänst
Fakturaprocessen 3.
Öppna brev? eller produkt
attesteringsprocessen
JÅ BH / LOR
1 ggr/dag Arkivering
Leverans av Källare Närarkiv
9 år 1 år Sätt i pärm
tjänst eller
Skicka L/T 0.5 min
produkt
vidare till
2 ggr/dag rätt person
Kontakta
leverantör
2 ggr/dag
Faktura
Registrering
ta bort orsaker till Nej
påminnelser
BH
Kontroll är
Rätt
fakturan
Nej
Påminnelse rätt?
Sortering från Ja Fel
leverantör Ja 2 ggr/dag Kontroll
Min faktura?
SAP
Inträffar varannan mån
L/T 1 dag = 1440 min Direkt 2 ggr/dag 2 veckor = 20 160 min

faktura
Leverantör
Registrering i SAP finns
Stämpla Skicka ut till
Inköp Attestansvarig
L/T 1 min fakturaansvarig
2 ggr/dag
Masterdata Ek-avd
L/T 5 min 2 h = 120 min 2 ggr/dag Lägg i kuvert
Leverantör L/T 0,5 min Attest Hos
attesteraren Ek-avd
saknas
Page 73 of 73
Process mapping / Manual Invoices
Nulägeskarta över fakturor via

order i SAP
040914
Inköp order
SAP Leverantör
L/T 8 min 1 ggr/dag
Beställare Påminnelse
1 ggr/dag från
av tjänst
eller produkt leverantör 2.
e över regler för
1. postöppning
1 ggr/dag
ERS -
mottagningsgodkännan Leverans av
de (ingen faktura) tjänst eller
produkt
2 ggr/dag
Faktura
MIGO Utvärdera
L/T 5 min L/T 2,5 h / vecka

ek. avd
Bokning
Oregistrerad faktura Viktig kund - betala via
kassa L/T 15 min
L/T 10 s = 0.17 min
Direkt Sortering
faktura
Om det är via
order
Om MIGO ej är gjord
Postgiro
MIRO Skapa Betala på
SAP betalningsfil rätt dato Arkivering
1 v = 10 080 min Närarkiv Källare
L/T 2 min Kontrollera bankkonto 1 år 9 år
Generera fil Bankgiro Sätt i pärm
L/T 0,5 min L/T 0.5 min
Process Map – Invoices based on MIRO (SAP)
Processtid
EKONOMIAVDELNIN
G
Direkt och SAP Leverantör
fakturor
2004-09-16
Beställare
$
$ $
SAP Antal order BOKFÖRING
Accounts Payable
4000/år 1 h/w =9s
Kaizen
Direkt, Antal order
? /år 0,5 d Bank
Scanning / Portal
reg i SAP 10 min
Postsortering
5.6h/w=53 s/fakt
1d
EKONOMIAVD. ARKIVERING
400 fakt/w 1,7 h/w =15 s
Kontroll och Attest
150 SAP 10 d EKONOMIAVD. 5d
250 Direkt
Sortera 5 m/fakt= 300 s ARKIVSÖK
1,7h/w =15 s/fakt Registrering 0,5 h/w =4s
Registrera i SAP Direkt 10 h/w =144 s
Direktfakt 10 h/w=144 SAP 15 h/w =360 s
s
Skickar Parkerade
Direkt 3,3 h/w=48s Direkt 0,5 h/w =7 s
Fakturafel Fel i attest
Kontroll Mottagning Direkt 1,3 h/w=19s
Direkt 0,5 h/w=7 s SAP
Kontakt Inköp (ny lev) 10 d Inkasso
Direkt 2 h/w = 29 s 2,5 h/w = 36s Processtid:
10 min/fakt
Avstämning Direkt 866 s
Går det att SAP 5 h/w =120 s SAP 1645 s
förenkla? Fel på fakt.
EB telefonkontakt Ledtid:
SAP 3,3 h/w= 79s Direkt 16,5 dagar
25 s int. Processtid: SAP 15,5 dagar
Direkt 866 s Betalningskörning
transport per
faktura SAP 1645 s 1,7 h/w = 15s
Säkerställa tiderna Kassabetalning
0,5 h/w =5 s
2 t 0 10 Days 5 d
343 15 s 243 s
0s 53 s 53 s 600s 300 s 615s 226 s 19 s 19 s
s
Value stream map of the process.
Page 74 of 74
Then the participant agreed on a possible future state for the process.
Framtida system
Ekonomiavdelningen
Alt 1 Extern scanning Leverantör
2004-09-16
POST/BANK Bokning
9s
Extern Scanning Arkiv
Investering 0,5
Ekonomiavd. MSEK
+ 6 SEK/faktura
Inläsning i SAP, 2 80% av scannade

min Attest Skapa betalningsfil
fakturor riktigt
300 s ??? 15 s
Kontroll och tolkade
distribution 20% av fakturorna
komplettering i SAP Fel mottagare, ??
Kostnad blir 72.000,- per år. + avskrivning~

30.000,-
Direktfakturor 335 s, besparing 530 s per SAP, besparing

faktura. Per år utgör detta 490.000,- 19 s (arkiv)
0 d 0 d 0 d
300 s
xx 10.5 s xx 0 s xx xx 15 s xx 9 s
???
Fel, 10 s
This solution would mean new technical solutions that would need to interact with SAP need
be implemented, the savings would according to the group be significant.
Some final comments from the group at end of the Kaizen, as they concluded we would need
to plan and have a project approved to continue:
To scan the invoices, distribute and approve using SAP workflow and archive the invoices
electronically will reduce the labour effort both for the finance departments and for the
approvers. In addition it will increase the speed in the process and ensure more accurate
monthly reporting at an earlier time. The scanning solution will give a machine-controlled
approval process and therefore reduce the risk for unauthorized vendor payment/ increase the
internal control.
Scanning and electronic archiving of vendor invoices is also a prerequisite for centralizing
the vendor invoicing process and payment function in DNE after implementing SAP.
To implement a scanning solution personnel resources will be needed from finance, GSC and
IS/IT in DNE.
6.1.4.2 Conclusion from the event

All participants expressed their enthusiasm about what was achieved during the two days and
how easily this method could be used to visualize possible improvements.
All in all I am very satisfied with both the technical/economical outcome of this event as it
actually ended up as a project that was successfully finished and also as the participants
Page 75 of 75
became very positive towards Lean and would now become usable ambassadors that would
ease the work to come.
The project itself had kick-off August 23 and the solutions were fully implemented and live at
October 31, 2005.
Invoice Invoice
arcivin display SAP
WF Step W
Scan- Invoice
Invoice data Aproval
transportatio Automatically generation with/witout
n of FI document or Invoice
Pipelin Pipelin
check against Purchasing
Scanne Invoice in Approved
TIFF- Invoice
WF Step
Invoice
value Master data WF Step
For those interested, above can be seen the process flow as it turned out. However, this
project could probably justify a thesis of its own and I have decided not to go into detail of the
project as I see this as outside of the scope of this thesis.
7 Discussion and Analysis

The Plan as presented here is very detailed and thorough regarding theoretical background
and also explains, or at least give input on, why and how (and why it is so important) to get
commitment from the management. When the plan was written it was my intention to use this
as foundation when implementing Lean in the various EMEA business units. What I have
done in the cases described above is more or less actually doing this by using the plan as a
basis in each individual case; the macro plan is used in micro applications.
In the previous chapters, as the Plan was developed, quite a lot of my discussion and analysis
were conducted. In this final chapter just a short version of all this will be dealt with.
In the analysis and discussion to follow, the Plan will be the foundation for my perspective.
How did this work out and what can be learned?
Creating a sense of urgency.

The plan starts by emphasising the importance of creating a sense of urgency. This is meant in
a broad way, a feeling that should be present on a general basis and not necessary in every
single event. In the events described however, this feeling of urgency is in some cases very
present, on a local basis. In the plan I refer to the fact that the results the last years have been
Page 76 of 76
the best ever in the company history. This is a somewhat difficult basis for a change program.
However, this need not be the case at every location seen separately.
In H-267, where we started with 5S, there was a feeling of urgency present as the volumes of
their products had been slowly decreasing for the last 10 years. In H-2100 this feeling was not
present, still 5S was successfully implemented. In H-268 I’m not sure about the status
regarding feel of urgency. According to the surroundings, with all the complaints, etc. one
might think this feeling should have been there, my first impression though was that the
employees her did not feel this. Also some of them had a relatively visual and verbal negative
attitude towards 5S and changes in general. Considering all this in after hand, they might very
well have had a feeling of urgency and / or crisis without showing this. Whatever their
feelings in this respect, after some “fighting” 5S was successfully implemented.
In the case of the Standard Work event a feeling of urgency was very so in place. Still, some
hostility towards the event was present up front but this ceased as the event went on. Also in
this case the event turned out positively with all participants enthusiastic about the method.
Neither in the case of Office Kaizen did we have any sense of urgency among the participants,
still the event turned out very positively with some very enthusiastic participants. Their
manager, the financial manager, actually started to study “Lean accounting” after this event
and started eliminate one non-value adding process after another. One of the first to go was
the budgeting process. This event turned out to be the start of a long row of improvements in
the administration. One might however, consider that the financial officers and employees are
so engaged in continuously improving the financial results they in a way always have a
feeling of urgency.
The conclusion from this point have to be that even though the literature I’ve been studying
emphasises the importance of this point, I’ve now learned that perhaps this is not so vital.
However, I still believe the participants should be at least engaged in the issues in question
and not unconcerned about their work.
Creating the Guiding Coalition

When applying this point in the macro terrain the meaning is to create at powerful team to
manage the practical details of implementing lean, to guide the local teams and support and
facilitate events. When I started to run the events referred to I was on my own with no real
team to seek support from, except the other lean managers in other continents. However, by
assistance from some consultants and very strong support and back up from my manager I
succeeded in getting the management team at the Gyttorp Plant to accept and support the
implementation of Lean. Actually, the manager at H-267 where we started with 5S turned out
to be very supporting and more or less took over the facilitator role here. To have such a
successful start probably eased the following cases.
What was done in all the events or cases described here were to establish a small team to be
responsible for managing and push their colleagues to follow the plan agreed to and also track
results. I very soon realized I could not be everywhere at all times and to have a local team to
communicate with turned out very helpful. In the last case described, the scanning of vendor
invoices, the event developed into a project with its own project manager and project team.
My role here was to be no more than an advisor, a very pleasant role indeed.
Developing vision and strategies
Page 77 of 77
In neither of the cases chosen do we dig into this point of the 8-step plan. As mentioned
earlier, the vision and strategies for all of Dyno Nobel was developed just prior to
implementing Lean and should be well known to all participants. One might however claim
that through the implementation of 5S and the planning of how to go ahead with the
implementation as done by the teams in a way was developing strategies. Still, what is
referred to here in the sense of vision and strategies are those that apply to the whole company
as such and nothing to be developed in each case.
Communicating the change vision

The overall change plan, the transformation to become a Lean enterprise, had been
communicated to the management team as well as all employees at multiple occasions,
including the MHP (Managing Human Performance) processes, what we at Dyno call the
performance appraisals. At the Gyttorp plant we actually performed those appraisal meetings
with every individual in 2004. Later we reduced this as most were actually covered through
the TOL (Team Objective Lab) process, as referred to in the Plan.
However, in the cases described here, what was done was to gather all the employees in a
house or department where the event in question was to take place and inform about Lean in
general as well as the theories behind the actual event. In all cases we described how the event
would be in line with the company vision and values and how they were to benefit from it.
I’ve always thought that understanding why is very important to an individual before actually
buying into something new, that the theories behind the changes were to be thoroughly
explained. What I learned however was that this not necessarily is the case. It actually seem
that one should be careful not to use to many words and to explain and demonstrate how and
why, but rather just insist and assert some “words of truth”. To my surprise it often seem that
the employees prefer to be told that “this is actually so” and then go on with it. The “what’s in
it for me” seems to be of greater importance. Still in the first case of 5S and in the case of
Standard Work a lot of time were spent on explaining the theories behind the event and this
seemed to be very valued by the participants. In the last case though, we did not go through
all this with everybody in the department, only with the participants in the vent.
Empowering Employees for Broad Based Vision

According to the plan it is absolutely necessary to establish teams and to use management
practises that favour group accomplishments as a way to give more responsibility to the
lower-level employees. One of the reasons for choosing the Gyttorp plant for those events
was that what we call “independent groups” had been implemented some years ago and that
this had became the way of management. This had been done after the Toyota model way
before the term Lean was known here. As mentioned briefly in the description of the cases,
the operators at the Gyttorp plant work in teams, are multi-skilled and have accepted the
responsibility that follow the empowerment they have, as handling production planning, stock
levels of raw materials, handling the customer orders directly (in SAP), performing
procurement, etc.
As all of this was more or less in place and part of the culture at the plant, no time was spent
on this matter of course. It was on the other hand exploited as I could let the teams handle
planning and allocation of tasks them selves.
Page 78 of 78
Generating short term wins
The Plan states that generating short-term wins is of crucial importance to gain momentum in
the change work. It should undermine the cynics and resistors; provide evidence that
sacrifices are worth it.
From this perspective the selection of cases seems to have been very fortunate as they all
turned out successful and served the intention. There are two directions when validating the
outcome of the events. The isolated benefits from it, as improved order and tidiness, reduction
in inventory etc. in the case of 5S, improved capacity in the case of Standard Work, improved
quality in the packaging process in the Poka Yoka event and the easily measurable cost
savings that originated from the Administrative Kaizen event on one hand and the fact that the
success in each of the cases helped gain momentum and to put the usefulness of Lean on the
map. From both perspectives this turned out very well.

As the successes in the cases described help build momentum to have more and more
departments want Lean welcome, the plan points out also the risk of satisfaction. That is,
satisfaction in way that make the employees in a department think they’re done with Lean. If
so, we would experience regression in the local development. The need for continuous
improvement should not be neglected.
From the isolated events or cases described here we cannot conclude regarding this point.
What we have achieved is local improvements and created momentum as Lean change
programs or events are more and more welcome at all the various departments and locations.
In the Standard Work event the participants made plans for improvements to come and by so,
at least to some extent, prepared them selves and accepted the need for continuously
improving. The same should be the case in H-280 where a Poka Yoka was held. Even though
some improvements to reduce the risk of errors where implemented, the risk of errors, even
though reduced, is still present. In the 5S events, the last S is all about consolidating the
change, to make sure we’re not slipping back into the chaos of the past, nor relaxing regarding
the need for order and tidiness. Discipline must be preserved.
Anchoring new Approaches in the Culture

As pointed out in the Plan, this is the last stage in the process of the Lean transformation. To,
at this point, claim that the new approach is anchored in the company culture would be rather
over-exaggerated. It is however my belief that by continuously pushing for changes and
improvements we can succeed in this challenge.
Looking at those cases from the perspective of the Plan, I’ll say that so far there is no
evidence this should not work. It is absolutely possible to make people change their behaviour
and to take more responsibility as we implement or utilize empowerment.
What are hardly questioned here are actually the theories of Kotter and if the use of such an
eight-stage change plan is adequate. Unfortunately I do not have enough experience in the art
of change management to evaluate this model up against other change models, however all
my “experiments” indicates his model actually work. In some of the cases I have not followed
the Plan chronologically. I have also skipped some of the steps at times; this has not been
done by accident or randomly though. In none of the cases described here have there been
much emphasis on the empowerment step as this was considered already implemented and to
Page 79 of 79
spend time on this did not seem important. Neither have there been spent time on developing
Vision and Strategy in the cases, this was left out as I considered also this step to have been
covered by the thorough discussion and participation by most employees as the company
vision, strategy and values were developed at an earlier stage. Still, I consider all the cases to
have been successful both in the sense of what were physically to be achieved in each case
and as the model, even though not followed in detail, seem to work. On the other hand, even
if the model work, one might wonder if the change would not have been just as effectively
implemented if the same amount of effort and time combined with normal courtesy and
respect for the individuals had been used without any specific method. Still, why take the
risk?
In chapter 5, “Creating the Change”, the focus was on peoples expectations and handling of
resistance. In many of the change models found in literature, an executive runs the change
program. There are statements as; ”You must lead the way58 ” and ”This is not a march you
delegate to the troops nor observe from afar”. There are questions like; why do employees
resist change? According to my own suggestions I should have expected to meet some
resistance and have had plans for how to handle that. I must confess I missed on this. Luckily
there were not too much resistance, however in H-268 two of the employees were rather
negative towards the changes. This really caused some worries and we actually discussed the
possibilities of removing at least one of them.
A less often described challenge is when the management itself resist change. This will
normally be expected when empowerment are to be implemented and as the staff then will get
more power, the management will lose some. Also, in quite a few cases a layer of managers
can actually be removed. In the cases I’ve described here, there has been very little of this. I
have experienced some resistance from a manager though, but this was more due to the loss
of production, as the events would take time away from production for the personnel
participating.
As I see it, there are two possible tracks to follow here, either continuing to run events locally
and to implement Lean by a case-to-case basis or start training more and more Lean
facilitators (including existing line management) and have the management push for all this to
happen.
8 Conclusions
The objective and scope of this thesis was to create a feasible plan, method or model for
implementing or transforming a company (the Scandinavian part of Dyno Nobel) to become a
Lean Enterprise. A secondary reason was to become more experienced with the phenomenon
of change management in general. To my opinion, both have been achieved.
Quite a lot of companies have performed similar changes successfully, or so they claim, and
are willing to share their wisdom. Through scepticism towards the validity and reliability in
some of those descriptions and the methods found successfully in places as Japan and USA,
as well as input from Scandinavian companies that have, at least partly, implemented the
philosophy of Lean and suggesting different methods. So, when all this started I had a
hypothesis saying that “we” in the Scandinavian part of Dyno Nobel had a more
58
Nightingale, Deborah J., et. al., Transitioning To A Lean Enterprise: A Guide For Leaders, Volume I
Executive Overview, MIT Lean Aerospace Initiative, September 2000. http://lean.mit.edu/ Dec.31, 2005, p1.
Page 80 of 80
“Empowered” staff than did our American colleagues with their more hierarchical managing
system and that this should be utilised when planning for change.
When this task was given me, my American colleagues explained to me how to go ahead
when implementing the different “Lean tools”. Or, to be more specific I was told how to
implement 5S. As mentioned above, I was somewhat sceptical towards their way being the
only right path. Even though I’ve had some criticism (from my US colleagues) as the way
chosen took too long, I’m now convinced that, at least in Sweden, the more slowly and
democratic way used at the Gyttorp plant are the preferred. By explaining how 5S work, what
are expected and then let the employees, in this case the operators, involved plan and manage
the changes, the success rate is very high. Our operators have demonstrated that they can very
well handle this responsibility. Then, what I have done is just to follow up and be available
for assistance. I have also, which I think is very important, reported and made visual to all
interested the changes achieved by presenting pictures and short reports at the company
intranet. Also, customers and others visiting the premises have been told about the changes
done and those planned. In all sites, houses or plants where 5S and other visual changes have
been implemented and planned we use billboards to show the plans and present pictures of
before and after. I truly believe that by visualise the changes done, those planned and the
responsibilities to all involved we achieve a lot of momentum.
The conclusion, as based on the theories and my gut feeling from the cases described, would
be to go ahead. Convince the management team to go for this. Have them back up the change
program, as did the manager at the Gyttorp Plant and this is all feasible - it is actually possible
to have people change their behaviour.
Still, to gain speed and increase the momentum more facilitators will be needed. All the cases
required a lot of preparations; engagement and follow up to make sure the improvements were
sustainable. One or two persons cannot achieve the input required to make any significant
change in a company or division of the size we have here. From this is we can conclude that
we need to spend time on training new trainers, and to be able to do that we need all the
support and back up we can get from the top management.
An important learning, to my disappointment, is that hardly anyone will spend time on

reading all the theories behind the chosen strategies or change program. To my opinion most
people believe you can purchase a package, have it implemented (by someone) and all will be
well. The commitment needed by top management, and the effort put into achieving the
changes cannot be achieved unless top management stand up for the (change) program. So, if
possible, keep it simple stupid. Meaning, you have to put your own reputation or integrity on
the line, you cannot just convince people by theories or examples, no matter how relevant or
logical they might be. The thing that matter most is personal engagement and commitment.
What I have experienced here actually corresponds very well to what can be learned from
literature. According to most theories referred to in this thesis, we need management to lead
the way to succeed and so far this have been working also in those cases, however, there have
been little experimenting on the contradictory.
I have observed that the changes we aim at performing are the result of tem work so even
though I’m focusing on the importance of management engagement, it’s the teams that need
be convinced. To achieve the results we want will depend on the creative ability of each
employee and make everyone a team player in order for lean to flourish.
Page 81 of 81
Lean has created cultural change at the Gyttorp plant. Change is upsetting, but it should not
create instability. For all the changes that were accomplished, the movement to a new way of
doing things was a managed process of adaptation, not a jarring crisis. We will be changing
Dyno Nobel, but it is a transition from one form of stability to another.
My plan will in short be to follow the Plan as presented here, continue to implement it part by
part in the different departments and locations as seem beneficial. That means that if a
location or department ask for help they will be prioritised. Only if I run out of ”volunteers”
will I seek to find areas for improvement and push the changes. So far this has not been the
case. After the first few events the ball so to speak has rolled downhill. However, after
performing the “easy” change cases, showing Lean is the way forward, there will probably
come a few less popular ones. Eliminating waste processes when it make life less burdensome
is very popular, doing the same when it require extra effort is not so popular among the
involved. An example can be to reduce inventory to help create the pull of products through
the line rather than have the products be pushed through might not be popular among all
involved.
9 Recommendations
In my work I have seen examples where the change in question was triggered by one very
engaged middle manager. After convincing the top management of the need for change, he
often finds himself as responsible for implementing the change in the organisation. In my case
this was not so, still when the task of implementing Lean all of the Scandinavian (and also the
rest of the European, Middle East and African) part of the company was given or delegated to
me I had the role of a middle manager.
When the top management delegates this kind of responsibility to someone lower down in the
hierarchy a new set of challenges are created. In my case, when implementing Lean at the
Gyttorp plant I was part of the management, however when I also had to take on
responsibility for the larger part I had regular meetings with the management group in the
company discussing progress and agreeing on the path forward. From this arrangement I felt I
had the necessary authority to manage this task. I would recommend that if anyone is to take
on such a responsibility, they should make sure they will not end up as a hostage and the
scapegoat if anything turns out negative.
On a few occasions I’ve been asked where or how I would recommend a company
considering implementing Lean to start. My answer is to start with Value Stream Mapping the
major value streams in the company. You need be aware of how and where value is created in
the company and where the wastes are hidden.
Starting with a “sure” win will also help create the momentum needed to go on. Start by
“picking the low hanging fruit” and then move on to the less popular changes. You have to
believe on the changes you propose or support and be prepared to prove them right. One
failure and you might loose all momentum.
Also, from my learning’s from the few cases described here, and others; you really need
management commitment. In a stressed working situation it might be difficult to take the time
needed for a Lean event. To gain the improvements you’ll need to invest time and effort.
Page 82 of 82
A last point here will be regarding anchoring the new approaches in the culture. In this kind of
change work it’s very important to have what we can call the culture bearers in the company
on your side. You really need some ambassadors talking positive about the changes to
succeed. In my case this happened just as much out of luck as by plan. I was very conscious
to have the unions’ representatives on my side and brought them into the planning phase of
each event in advance. Those people turned out be some very strong personalities and premise
suppliers with good contacts also across the borders in Scandinavia. Luckily, with both their
and the top managements support the changes turned out fairly successfully.
10 Appendix 1
Just-In-Time
Just-In-Time (JIT) - to produce only what is needed, only when it’s needed, and only in the
quantity needed. For manufacturing, the real benefits of JIT are reduced lead-time and
increased flexibility, and those are distinct competitive advantages. JIT production, as
developed in Japan, has three essential principles:
• one-piece flow
• multi process handling in U-shaped cells
• pull production
Japanese companies found the following seven (7) steps lead to success in implementing one-
piece flow:
1) Build an environment for multi-process handling and develop worker discipline
and training.
2) Build U-shaped cells and devise defect prevention measures.
3) Establish cycle-time production. Calculate the minimum required number of
workers and the optimal work distribution.
4) Make changeover improvements and work toward zero changeovers.
5) Establish pull production and its corresponding supply system and take measures to
prevent missing items.
6) Introduce simple automation methods.
7) Gradually introduce the kanban system.
These steps are integral to successful implementation of lean. We must evaluate where we
are compared to these steps in each of our operations.
Value Stream Mapping

Value stream mapping as an effective tool to identify waste and to measure value flow from
raw materials to finished goods. Product centres are responsible for value stream
management and velocity improvement. The mapping methodology recommended is that
taught in the book Learning To See, by Mike Rother and John Shook. Teams should map
current and future state value streams for major product lines, identify wastes and kaizen
opportunities, and link them to goal statements and action plans. Maps are generally hand
drawn on the shop floor or after “walk the process” sessions. Operators must be involved in
the development of the maps, which are then posted in production areas for feedback. As
improvements are accomplished, the current state map can simply be updated in red marker as
a visual reminder of gains made. Value stream maps are used as a guiding light to flow value
Page 83 of 83
by eliminating waste, removing unnecessary complexity, and identifying bottleneck
operations.
Process flow diagrams should also be used to identify both manufacturing and administrative
value-added and non-value-added steps in key processes. The diagrams should be colour
coded to highlight waste, and other lean tools should be used to make improvements.
Standard Work
Standard work, or standard operations, represents the effective combination of workers,
materials and machines for the purpose of satisfying customer requirements. It is the
backbone of any JIT production system.
The three basic elements of standard work: 1.) tact time, 2.) work sequence, and 3.) standard
WIP, when properly applied ensure the institutionalisation of Dyno Nobel’s best practices.
This standardization ensures that we continuously employ the same methods, tooling, etc.
time after time. This lack of variation facilitates an easy identification and remediation of
abnormal situations and an excellent platform for future kaizen. Without standard work, there
is no kaizen.
The employment of standard work is a management responsibility. Management must ensure

that the tools of standard work - standard worksheets, standard work combination sheets, and
training are being properly used and followed. Management should continuously review
operations to determine whether the best practices are being followed, and if not, ask “why”.
We must motivate our teams to be revolutionary in our improvements and not just
evolutionary in improving standard work.
Five S
The 5-S’s are our foundation blocks upon which we can lay flow production, visual controls,
standard operations and other kaizen tools. They provide Dyno Nobel virtually a no-cost way
of improving safety, productivity, communication and housekeeping. The 5-S’s are as
follows: 1.) Simplify, 2.) Straighten, 3.) Scrub, 4.) Stabilize, and 5.) Sustain.
1.) Simplify represents the physical removal/elimination of unneeded supplies, tooling,
machines and furniture from the work area. By virtue of this task we can de-clutter our
environment, free up valuable floor space, reclaim and redistribute valuable assets,
eliminate searching through unnecessary items, etc.
2.) Straighten is the formal designation of locations for all remaining items to ensure
efficient and safe storage and retrieval. This employs sign boarding, colour coding, and
point-of-use storage to facilitate the identification of normal or abnormal situations.
3.) Scrub requires the deep cleaning of the workplace and returns the environment to a
near “new” state of cleanliness. Such a state helps in the identification of drips and
leaks and subsequent root cause analysis.
4.) Stabilize prompts workers to create systems and practices to maintain and improve
the first 3-S’s. It also includes eliminating or mitigating the causes of dirt, leaks and
spills.
5.) Sustain. Develop a habit of practicing the first 4-S’s. Make 5-S a way of life.
Page 84 of 84
The 5-S’s are true fundamentals which can be successfully applied with some simple tools
and strict discipline. The tools include 5-S training, red tags, checklists, patrols, the 5 why’s,
and events. The discipline must be provided from the top of the organization through the
bottom to zealously pursue the 5-S’s and sustain the gains.
Visual Controls
Visual controls are a powerful kaizen tool, which communicate opportunities for waste
elimination and problem solving, and facilitate standard work. More specifically, they:
1.) Distinguish between what is normal and what is not,
2.) Make abnormalities and waste obvious enough for anyone to see,
3.) Constantly uncover needs for improvement.
There are a number of visual controls, which are beneficial individually or together. They
include:
• Red tag strategy • Signboard strategy
• Demarcators • Andon
• Kanban • Production management boards
• Standard operation charts • Defective items display
• Error prevention
Each Dyno Nobel operation, its status, work sequence, standard WIP, etc. should be self-
evident to any worker, supervisor, manager or visitor. Only when we have reached that level
can we say that our visual controls are adequate.
Mistake Proofing
Mistake proofing (poke yoke) is a powerful weapon against waste by eliminating errors that
cause defects in the products we make. Mistake proofing starts with the understanding that
human errors are inevitable but that these errors can be eliminated. The discovery of errors at
the source, before they become defects, is the key to success. There are three levels of
mistake proofing devices:
Level 1.) eliminates the error at the source before it can occur.
Level 2.) detects the error in the process of it occurring.
Level 3.) detects the defect after it has been made, but before it reaches the next
operation.
There are some “musts” for implementing a mistake-proofing program:
1) Take away the choices for error. (5-S)
2) Reduce the number of steps in a process. (Standard Work)
3) Improve the work environment, eliminate clutter. (5-S)
4) Everyone must perform the process the same way. (Standard Work)
5) Procedures must be clear and simple. (ISO 9000)
6) Perform process capability studies for process control.
7) Employ statistical process control (SPC) where applicable.
8) Ask, “Do you understand?” Answer, “Yes”, reply, “Show me.”
9) Train - Train - Train
5 Why’s
Page 85 of 85
The 5 why’s are the most versatile tool we have available. They represent a method of
evaluating a problem or question by asking “why” five times to identify the root cause(s). We
cannot effectively apply our waste elimination tools of JIT, standard work, 5-S, etc. unless we
can quickly wade through the symptoms and arrive at root causes. This is consistent with our
philosophy of taking action based on data.
11 References
James P. Womack and Daniel T. Jones LEAN THINKING SECOND EDITION ISBN: 0-
7432-4927-5
Jeffrey K. Liker, The Toyota Way, McGraw-Hill, ISBN 0-070139231-9
Freddy Ballé & Michael Ballé, The Gold Mine, a novel of lean turnaround, the Lean
Enterprise Institute, ISBN 0-9743225-6-3
Michael L. George, Lean Six Sigma, McGraw Hill, ISBN 0-07-138521-5
James P. Womack, Daniel T. Jones & Daniel Roos, The Machine That Changed The World,
Rawson Associates New York, by Simon & Schuster, ISBN 0-89256-350-8
M.Rother and J.Shook. Lean Enterprise Institute. ”Learning to See”, ISBN 0-9667843-0-8
John P. Kotter, ”Leading Change”, published by the Harvard Business School Press, 1996.
James P. Womack and Daniel T. Jones, Lean Solutions, Simon & Schuster, ISBN 0-7432-
7595-0
Rick Harris, Chris Harris, Earl Wilson, Making Materials Flow, Lean Enterprise Institute,
ISBN 0-9741824-9-4
Art Smalley, Creating Level Pull, Lean Entreprise Institute, ISBN 0-9743225-0-4
Womack, J.P., D.Jones, D.Roos, The Machine That Changed the World; The Story of Lean
Production. (HarperCollins, 1991)
Kotter, J.P., Leading Change. (Harward Business School Press, 1996)
Nightingale, Deborah J., et. al., Transitioning To A Lean Enterprise: A Guide For Leaders,
Volume I Executive Overview, MIT Lean Aerospace Initiative, September 2000.
Professor Daniel T Jones, Chairman, Lean Enterprise Acedemy at the Lean Service Summit –
Amsterdam, 23 June 2004.
Womack, J.P., D.Jones, D.Roos, The Machine That Changed the World; The Story of Lean
Production. (HarperCollins, 1991)
Page 86 of 86
Richard Schonberger, "Japanese Manufacturing Techniques" (1982)
Martin, L. (1993). ”Total Quality Management: The new Managerical Wava.” Administration
in Social Work. 17(2), 115
Pruger R. and Miller L (1991) ”Efficiency,” Administration in Social Work. 15(1/2), 42
Osborne, D. & Gaebler, T. (1992). Reinventing Government. Reading, MA: AddisonWesley
Bennis, W., Benne, K, & Chin, R., Eds. (1985). The Planning of Change. 4th Ed., New York:
Holt, Rinehart, & Winston, 98105.
Bennis, W. & Nanus, B. (1985). Leaders. New York: Harper & Row
Robey, D. (1991). Designing Organizations 3rd ed., Homewood, IL: Irwin, p. 42.
Packard, T. (1989). Participation in decision making, Performance, and job satisfaction in a
social work bureaucracy. Administration in Social Work. 13(1), 5973.
Hyde, A. (1992). "The Proverbs of Total Quality Management: Recharting the Path to Quality
Improvement in the Public Sector," Public Productivity and Management Review. 16(1), 25-
37.
Brager, G. & Holloway, S. (1992). "Assessing the Prospects for Organizational Change: The
Uses of Force
Field Analysis." Administration in Social Work. 16(3/4), 1528
Vroom, V. and Yetton, P. (1973). Leadership and Decision Making. Pittsburgh: University of
Pittsburgh Press.
Beckhard, R. & Harris, (1987). Organizational Transitions: Managing Complex Change. (2nd
ed.) Reading, MA: AddisonWesley.
Internet Referenses
Lean Thinking and Strategic Asset and Service Management , Jan 05, 2006
http://www.strategosinc.com/taiichi_ohno.htm, Jan 14, 2006

Test-based Project Progress Reporting by John Ferguson Smart,
http://www.stickyminds.com/sitewide.asp?ObjectId=10094&Function=DETAILBROWSE&
ObjectType=ART
http://www.fairdene.com/apx-c-theory.html
Overview, MIT Lean Aerospace Initiative, September 2000. http://lean.mit.edu/ Dec.31,

2005, p1.
Page 87 of 87
Richard L. MacInnes, Lean Enterprise Memory Jogger, Goal/QPC, www.goalqpc.com
Nightingale, Deborah J., et. al., Transittoning To A Lean Entreprise: A Guide For Leaders,
Volume I Executive Overview, MIT Lean Aerospace Initiative, September 2000.
http://lean.mit.edu/ Dec.31, 2005, p 7
Leanness: experiences from the journey to date , T.C. Papadopoulou, M. Özbayrak

http://www.emeraldinsight.com/Insight/ViewContentServlet?Filename=Published/EmeraldFu
llTextArticle/Articles/0680160706.html, Dec. 31, 2005
Improving workshop efficiency by Steven J. Feltovich,

http://www.asashop.org/autoinc/june2004/manage.cfm Jan 05, 2006
James P. Womack, Daniel T. Jones, Daniel Roos, 1990, The Machine That Changed the
World : The Story of Lean Production (Paperback) Author: ISBN: 0-89256-350-8
http://www.swmas.co.uk/info/Introduction.php
http://www.mepol.org/site59.php
Page 88 of 88

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The Digital Step

Change Management or continuous

1.1.1 The problem

1.4 Scope and results

1.4.3 Results and Deliverables

1.4.4 Target group

1.5 History of Dyno Nobel

1.6 Changing the company

Materials Order Entry

The Lean Theories will be further described in chapter 3, Theory.

Below is a visualisation of the workflow of the study

Defining the scope of the study

Learning about Lean through participation in events and conferences as well

Further literature studies regarding change management.

Defining the subject or the problem of the study

Setting up the study

Initializing and participating in some change programs and events

Creating the Plan

Discussion and Conclusion

Qualitative research seeks to understand and interpret personal experiences, behaviours,

2.2 Research Purpose

2.3 Research Approach

2.4 Research Strategy

2.5 Literature and Historical Study

The structure of the literature and historical studies was:

2.6 Case studies

Date Place Case Participants

2.6.1 Data Collection

2.6.2 Sample Selection

2.6.3 Data Analysis

2.7 Validity and Reliability

2.7.2 Construct Validity

3 Theoretical frame of reference

Toyota’s Lean Strategy25

3.1 The Lean Philosophy

3.1.1 Lean, or the Toyota Production System

The ten rules of lean production can be summarized30 :

• Eliminate all unnecessary waste

3.1.2 Lean (Kaizen) Tools

Process oriented thinking is a systemic and collaborative approach to cross-functional

3.1.3 So, what do we have to change?

Customer and Value Stream

Waste Minimization and Continuous Improvement

(1) It is an action that undoubtedly creates value.

FIGURE of WASTE MAP.

Flow and Pull

Near-Perfect Product Quality

Horizontal Organization Focus

Relationships Based on Mutual Trust and Commitment

It is desirable in most cases to establish labour-management partnerships that stress win-win

The development of electronic commerce (e-commerce) is changing the manner in which

In his book Japanese Manufacturing Techniques36 , Richard Schonberger explains, in clear

The effort to convert to Lean gained momentum. A reliable means of implementation

3.2.2 Business Idea (Mission)

3.2.3 Critical Success Factors (CSFs)

• Health, Safety and Environment

3.2.4 Values LEAN

together as an organization and a team.

Values create the company culture – they

way we treat our customers, each other

3.2.5 Planning for change

Identify the Value Stream